Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
5 Cards in this Set
- Front
- Back
- 3rd side (hint)
|
Strike price |
Price at which option can be bought or sold. |
|
|
|
Underlying security |
The security on which a derivative derives it's value. Can be a asset, index, financial instrument or even another derivitive. |
Google "stock" |
|
|
Put option |
A put option is an option contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying security at a specified price within a specified time. |
|
|
|
Call option |
Agreement that gives an investor the right but not the obligation, to buy a stock, bond, commodity or other instrument at a specified price within a specific time period. |
You profit on a call when the underlying asset increases in price. |
|
|
Straddle |
A straddle is an options strategy in which the investor holds a position in both a call and put with the same strike price and expiration date, paying both premiums. |
|
