Business, Legal & Accounting Glossary
An approach used by investors to profit from the price at which an option trades by originating and selling an option contract while they hold an opposite and equal position on the asset that gives value to the security. When an investor owns the asset underlying the option and writes a call to make the asset available for sale to the owner of the option if the option is exercised, it is termed a buy-write call option. When an investor writes a put with enough cash to cover the sale if the put is exercised, it is termed a buy-write put option. Also called covered option.
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This glossary post was last updated: 20th November, 2021 | 0 Views.