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Options buyers are
paying a premium, sell it to them! Their investments lose value as it
relates to your investment!
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Definition from Investor Glossary Option Premium refers to the per-share amount that a buyer pays for an option - for the right to buy/"call" or sell/"put" a security at a specified price in the future. An option premium is a non refundable, full payment (not a down payment ) for the rights specified in the stock option contract. One pays an option premium regardless of whether or not the option is actually exercised. The option premium often changes, due to fluctuating market conditions and economic variables. An option premium is therefore determined by several factors. The main thing affecting the option premium is the difference between the stock price and the strike price, which is the specified future price. Additional primary factors affecting the option premium include the time remaining for the option to be exercised and the volatility of the underlying stock. _____________________________________________________________________ Our methodology is simple. We give you the information needed to make an informed decision on which option strategy to invoke. The basic truth of being an option premium seller is well-known to every professional option trader. You will make money most of the time but get killed occasionally. Our method eliminates your getting killed occasionally because the maximum loss is known when the position is taken but the profit potential is not !!!!! Since most stock options lose value - sell that premium to others - !!!! Email us for our current portfolio |
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The preimium is captured by you many time over! Their speculative money goes into your brokerage account.
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