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Futures Terms |
| Browse our glossary of terms by using the Alphabet below. You may also search the glossary by using the search box in the right column. | |
| Put Option | The buyer of a put option has the right, but not the obligation, to sell an underlying asset at a specified "strike" price on (in the case of a "European"-style exercise) or by (in the case of an "American"-style exercise) a specified expiration date. The buyer pays the seller a "premium," and may profit if the price of the underlying asset is at a level below the strike price plus the premium paid, by the put’s expiration date. The seller of a put option receives and keeps the premium, but may have to sell the stock if the buyer "exercises" the option.
Both buyers and sellers of options can offset their positions. |