call options

Rights to buy

Call options are financial contracts giving the holder the right, but not the obligation, to buy an asset at a specified price within a set time period.

The buyer pays a premium for this right, betting the asset's price will rise above the strike price before expiration.

If it doesn't, they lose only the premium: She bought call options on Tesla at $200, hoping the stock would surge.

mechanics

strike price

Predetermined option execution level

exercise · assignment · expiry date · lot size · settlement · cash settlement

valuation

premium

Added cost for better

pricing model · dividend yield

speculation

bullish

Expecting market gains

meme stocks

greeks

delta

Symbol denoting variation

  • gammaGreek alphabet's third
  • thetaEighth Hellenic letter
  • vegaVolatility sensitivity metric

rho · sensitivity · decay rate

leverage

amplify

Increase in strength

strategies

rolling

Turning over repeatedly

Categories
Opposites
directional position

call optionsput options

Contracts to sell at set prices

puts · short positions · shorting · short selling

derivative type

call optionsfutures contracts

Agreements to trade later

forwards · obligations · binding contracts

derivative complexity

call optionsstock ownership

Possessing corporate equity

Family

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