A stock option is a financial contract that gives the owner the right, but not the obligation, to buy or sell a stock at a ...
Stock options are contracts that represent the right to buy (or sell) shares of the underlying equity at a predetermined price, and by a predetermined date. Stock options are traded in units ...
This is simple arithmetic: options are cheaper to buy than the stocks from which they derive their value. If a stock is trading at $50 per share, it would cost you $5,000 to buy 100 shares.
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