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The appeal of buying call options is that they drastically magnify a trader’s profits, as compared to owning the stock directly. With the same initial investment of $200, a trader could buy 10 ...
Options are contracts that give their owner the right, but not the obligation, to buy or sell an underlying asset such as a stock. Options come with an expiration date, after which the option ...
Options Ins and Outs. An option is a contract giving an investor the right, but not the obligation, to buy or sell a stock or other asset at a set strike price by a certain expiration date ...
The Chicago Board of Trade (CBOT), established on April 3, 1848, is one of the world's oldest futures and options exchanges. [1] On July 12, 2007, the CBOT merged with the Chicago Mercantile Exchange (CME) to form CME Group. CBOT and three other exchanges (CME, NYMEX, and COMEX) now operate as designated contract markets (DCM) of the CME Group.
A trader who expects a stock's price to increase can buy a call option to purchase the stock at a fixed price (strike price) at a later date, rather than purchase the stock outright. The cash outlay on the option is the premium. The trader would have no obligation to buy the stock, but only has the right to do so on or before the expiration date.
It was developed by the Chicago Mercantile Exchange (CME) along with other technology companies and it was designed to work with the existing open outcry system at the exchange to help improve efficiencies and extend the hours of trading. Globex, or "CME Globex", offers trading approximately 23 hours a day, five days a week. [3]
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