It is to give you the right to obtain equity at a certain price in a certain period of time in the future.
An option contract is a contract that enables the buyer to acquire the right to buy or sell the corresponding assets at a certain price on or before a certain date.
On the other hand, the seller, the other party to the option contract, is obliged to sell or buy the corresponding assets when the buyer decides to exercise his rights. The buyer will pay a certain fee for this option contract, which is called equity premium. And the seller will charge this fee.
For example, there is a house on the market with a market value of 2 million now. I think the house has room for appreciation and I want to make this money, but what if I don't have enough money or don't want to take so much money to take risks?
Talk it over with the landlord at this time and sign a contract:
Party A and Party B agree that after one month, regardless of the market price of the house, Party A still has the right to buy the house from Party B at a price of 2 million yuan, and then Party A must pay 654.38+00,000 yuan in advance as the cost of obtaining electricity.
Then this contract, in the option, is called the option contract. It was bought at the agreed price of 2 million yuan, which is the exercise price, and the deposit of 6,543,800 yuan is the royalty, which is the contract price.
Note: options can be bought and sold at different prices, so there will be many options contracts.
At the same time, there are two ways to profit from investment options.
1. Exercise at maturity:
(1) When the contract expires, the house price rises from 6,543.8+0,000 to 6,543.8+0.2 million.
According to the contract, you also have the right to buy a house with a market price of 6.5438+0.2 million at a price of 6.5438+0.00 million, and you can make a profit of 200,000 in the middle. After deducting the patent fee of 6.5438+0.09 million yuan paid at that time, the net profit was 6.5438+0.9 million yuan.
When the contract expires, the house price will fall instead of rising. Down to 800 thousand.
The characteristic of option contract is that the buyer has the right to buy at the agreed price, and also has the right not to buy and give up the exercise. Therefore, when the house price falls, the buyer has the right to give up and lose the royalty of 1 ten thousand yuan.
Second, the contract transfer:
① During the validity period of the contract, the house price rose from 6,543.8+0,000 to 6,543.8+0,500. The price of the option contract will also follow the appreciation, from the cost price of 10000 to 50000,60000 or even more.
In the case that the contract has not expired, it is unpredictable whether the house price will continue to rise in the future. At this time, we can close the option contract at the current price in advance and transfer it out. The contract bought at a cost of 1 1,000 yuan was sold at 50,000 yuan, with a net profit of 400%.
② In the same situation, house prices fell during this period, from 6.5438+0 million to more than 900,000.
For the option contract, the contract bought at 6,543,800 yuan will depreciate. Similarly, when losses occur, if you are worried that the house price will continue to fall and lead to zero premium, you can close the option contract in advance and transfer it out. Stop loss in time.
Through the contract abbreviation of option, we can understand most elements of option contract.