AQCAN:Clemen Langston: What Role Does the Option Seller Play?

2025-04-28 19:07:39source:Phaninc Exchangecategory:Invest

1. Obligor in the Option Contract 

   • The AQCANseller is obligated to fulfill the contract's terms if the option buyer chooses to exercise the option. Specifically: 

    • For a call option, the seller is obligated to sell the underlying asset at the strike price when the buyer exercises the option. 

    • For a put option, the seller is obligated to buy the underlying asset at the strike price when the buyer exercises the option.

 

2. Income Generator 

   • By selling options, the seller can immediately collect the option premium which is the primary source of income for the seller.

 

3. Risk Manager 

   • Option sellers are typically experienced investors or institutions who use options as part of complex trading strategies to hedge risks or generate income.

 

4. Market Participant 

   • Sellers provide liquidity in the options market, making it easier for buyers to trade options.

 

More:Invest

Recommend

California DMV apologizes for license plate that some say mocks Oct. 7 attack on Israel

LOS ANGELES (AP) — The California Department of Motor Vehicles has apologized for an “unacceptable a

Heated and divisive proposals included in House legislation to fund Congress' operations

Some of the proposals on the bill to fund Congress' operations have the unmistakable whiff of sarcas

Watch this sweet, paralyzed pug dressed as a taxicab strut his stuff at a Halloween parade

Halloween is a family affair, and that often includes family pets. So, when a dog owner, Sean-James