This is my little cheat sheet to help me keep the terminology between trading platforms an different lingo straight:

Zecco:Sell to Open --  To begin to Sell or Write an Option. You can sell or write a CALL (when you think the stock you own will go up) or a PUT (when you think the stock you own will go down). Used to create a Covered Call (when you own stock and sell a call option for additional income with risk of limiting your upside)

So 4 types of basic options:

  1. Writer can sell a CALL
  2. Writer can sell a PUT
  3. Buyer of a CALL
  4. Buyer of a PUT

A Buyer tends to have a long position or view of the stock, the Seller or Writer tends to have a short view or position of the stock.

Buyers of the options have the OPTION, not an obligation to exercise the strike price. 

Writers/Sellers ARE obligated to buy or sell if an option is exercised by the buyer deciding to exercise an option.

Okay, that makes some sense but it is a bit abstract. Now some scenarios to make it come to life. 

CachedSince:{ts '2024-06-12 19:20:53'}