Option Basis-Individual stock options

    1.什么是个股option？
    An option is a contract between two trading parties regarding future buying and selling rights. In the case of individual stock options, the buyer (right holder) of the option obtains a right by paying a certain fee (premium) to the seller (obligation holder), that is, the right to buy or sell a specified number of stocks from the option seller at the agreed time and price, orETF。 Of course, the buyer (right holder) can also choose to waive the exercise of rights. If the buyer decides to exercise their rights, the seller has an obligation to cooperate.


    2.个股期权包括哪些基本要素？
    Individual stock option contracts typically include the following basic elements:
    (1)Contract type: divided into call options and put options.
    (2)Contract subject: The subject of an individual stock option contract is a single stock listed and traded on an exchange, orETF。
    (3)Contract Expiration Date: The date on which the contract expires and is also the last date on which the option buyer can exercise their rights. After the contract expires, it automatically expires, and the option buyer no longer has rights and the option seller no longer assumes obligations.
    (4)Exercise price: The exercise price, also known as the strike price or strike price, is the price at which a buyer of a stock option buys or sells the subject matter of the contract.
    (5)Contract unit: refers to the number of contract subjects corresponding to an individual stock option contract.
    The trading amount of an individual stock option contract=premium × Contract unit
    (6)Exercise price spacing: refers to the difference between the exercise prices of adjacent stock options, usually set in advance.
    (7)Delivery method: divided into physical delivery and cash delivery.
    Physical delivery refers to the payment of cash by the right party of the call option to purchase the underlying asset after the expiration of the option contract, the revenue from the obligation party of the call option to sell the underlying asset in cash, or the revenue from the right party of the put option to sell the underlying asset in cash, and the obligation party of the put option to buy the underlying asset and pay in cash.
    Cash delivery refers to the payment of the price difference between the buyer and seller of an option in cash based on the settlement price, without involving the transfer of the underlying asset.


    3.个股期权有哪些类型？
    According to different standards, individual stock options are divided into many types. Below, we will introduce the following classifications.
    (1)Divided by the rights of option buyers into call options and put options
    Call option refers to the right of the buyer (right holder) of the option to purchase a certain amount of underlying assets from the seller (obligation holder) at the agreed time and price, and the buyer has a call option.
    Put option refers to the right of the buyer (right holder) of the option to sell a certain amount of underlying assets to the seller (obligation holder) of the option at the agreed time and price, and the buyer has a put option.
    For example, Mr. Wang bought a stock at an exercise price of15When the contract expires, no matter what the market price of the stock is, Mr. Wang can15Purchase the corresponding quantity of the stock at a price of yuan per share. Of course, if the market price of the stock falls to15If the price is less than yuan per share, Mr. Wang can waive the exercise and lose the paid premium.
    (2)Divided by the time limit for option buyers to exercise options, it is divided into European options and American options
    European options refer to options that can only be exercised by the buyer on the expiration date of the option.
    American options refer to options that can be exercised by the buyer on the trading day or expiration date prior to the expiration of the option.
    American and European options are divided based on the exercise time. Compared to European options, American options are more flexible and give buyers more choices.
    (3)Divided by the relationship between the exercise price and the market price of the underlying securities, it can be divided into real value options, flat value options, and imaginary value options
    Real options, also known as in the money options, refer to the condition that the exercise price of a call option is lower than the market price of the underlying securities, or the exercise price of a put option is higher than the market price of the underlying securities.
    A flat option, also known as a flat option, is a state in which the exercise price of an option is equal to the market price of the underlying security.
    False value option, also known as out of the money option, refers to the condition that the exercise price of a call option is higher than the market price of the underlying securities, or the exercise price of a put option is lower than the market price of the underlying securities.
    For example, for an exercise price of15When the market price of the stock is20When yuan, the option is a real value option; If the market price of the stock is10Yuan, then the option is a phantom option; If the stock price is15Yuan, then the option is a flat value option.