Using Options To Buy Stocks – Build Wealth With Little Risk And No Capital (Dearborn-2000)

Description

Although options are typically bought and sold through security dealers and brokers, it is
important to understand that options are not securities. Unlike stocks, warrants, or
corporate bonds, options are not authorized or issued by any company on its behalf.
Rather, an option is simply a contract between two parties, a buyer and a seller. The
buyer is often referred to as the owner or option holder, and the seller is often referred to
as the option writer. A call option gives the option holder the right to buy an asset at a
set price within a certain time, while a put option gives the option holder the right to sell
an asset at a set price within a certain time. In neither case is the option holder ever
obligated to buy or sell