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What does option mean and what is its function?
Option, like futures, is a contract. After paying a certain price to the seller, the option buyer has the right to buy or sell assets at a fixed price on or before a certain date.

What do options mean? An option is a contract that designs buyers and sellers. A contract gives the holder the right to buy or sell at a fixed price at or before a certain time.

Option refers to a contract, which originated in the American and European markets in the late18th century. This kind of contract gives the holder the right to buy or sell assets at a fixed price on or before a certain date.

The right to choose is a right. An option contract includes at least a buyer and a seller. The holder enjoys rights, but does not assume corresponding obligations.

What does this option do? 1. Risk transfer: When the stock price is considered to be falling, you can buy put options and lock in the lowest selling price in the future, so as to lock in gains or avoid greater losses, and finally realize risk transfer.

2. Spend small money to do big things: use small money to incite huge gains, which can reach several times, ten times or even dozens of times.

3. Leverage the wind to make power: During the period of holding the underlying assets, you can use the power of options to sell the call or put options, reduce costs and improve the holding income. Everyone can understand it as "holding a house for rent".

How should options be traded? According to the analysis of the price trend of the underlying assets, traders think that the price of the underlying assets will fall or narrow, so they can consider selling call options and charging a certain premium. When the price of the underlying asset falls, the market price of the call option will also fall. At this point, traders can hedge the short positions of call options and get the spread income. If the trader firmly believes that the price of the underlying asset will not rise, the trader can hold the option until it expires, thus achieving the purpose of earning royalties.

How do I open the options? 1. Contingent assets: daily average assets under custody in the first 20 trading days >; 500,000 yuan

2. Experience: I have opened an account for 6 months and have comprehensive financial qualification or financial futures trading experience.

3. risk tolerance: risk tolerance > C3

4. Knowledge: Pass the knowledge test of exchange options.

5. Having simulated trading experience: having simulated trading experience recognized by the Exchange.

6. No violation of laws and regulations: It has simulated trading experience recognized by the Exchange, no serious bad credit record, and options trading is prohibited or restricted by laws, administrative regulations, departmental rules, normative documents and business rules of the Exchange.

If the above conditions cannot be met, you can choose a third-party zero-threshold warehouse platform, which is similar to an option. It is also a better way to open the zero threshold.