What is call option and PUT option? Who decide the premium?

[Loyd Dsouza]

call option :buyer gets rights to buy. buyer makes money if the price goes above strike price.

put option :buyer gets rights to sell. buyer makes money if price is below the strike price.

buyer and seller decides the premium.

[Rajarathinam]

Call option – Buyer has the right to buy but with no obligation to buy. Buyer makes profit when the price goes above the strike price. Both Buyer and seller decide the premium. Seller makes money through premium

Put option – Seller has the right to sell but with no obligation to sell. Seller makes profit when the price goes below the strike price. Both Buyer and seller decide the premium. Buyer makes money through premium<b></b><i></i><u></u>

 

 

[sivaranjani]

Call Option: The buyer gets the rights to buy with no obligations. Buyer only makes money once the price goes beyond the strike price.

Put Option: The buyer gets the rights to sell with no obligations. Buyer only makes money once the price goes below the strike price.

In both the cases the seller gets a premium and bears a loss only if the strike price criteria is met.

Both the sellers and buyers negotiate to decide the premium

[Geena]

call option : That gives the buyer the right ,but not the obligation

Put option : Is an option contract giving the owner the right but not the obligation.

[Praveen Kumar Ramachandran]

<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Roboto Slab’; font-size: 13px;”>Call Option: The buyer gets the rights to buy with no obligations.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Roboto Slab’; font-size: 13px;”>Put Option: The buyer gets the rights to buy with no obligations.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Roboto Slab’; font-size: 13px;”> sellers  decide the premium</p>

[Author]

Posts