For many people who have just come into contact with or understand the 50etf option, there may be such a question, is the 50etf option a stock option? In fact, there is no doubt that 50etf options are stock options. On the one hand, from the essence of the underlying 50etf option contract, on the other hand, the Shanghai Stock Exchange has given an explanation.

Image source: Baidu's financial options

50etf option contract price changes are closely related to stocks.

First of all, we all know that the target of 50etf option contract is SSE 50etf, which is a trading open index fund based on SSE 50 tracking stock index. 50etf option contract is a standardized contract formed by this target.

Secondly, judging from the influencing factors of the price changes of 50etf option contracts, the most important and core influencing factor is the SSE 50 Index, which corresponds to the 50 stocks selected by the Shanghai Stock Exchange when compiling the SSE 50 Index. It can be said that the comprehensive trend of these 50 stocks determines the price trend of 50etf option contracts.

Shanghai Stock Exchange's Interpretation of Stock Options

Stock option contract is a standardized contract formulated by Shanghai Stock Exchange, which stipulates that the buyer has the right to buy or sell the agreed stock at a specific price at a specific time in the future or a transactional open index fund (ETF) that tracks the stock index.

Definition of options in Shanghai Stock Exchange

An option is a contract in which both parties buy and sell their rights in the future. As far as individual stock option is concerned, the buyer (obligee) of the option obtains a right by paying a certain fee (royalty) to the seller (obligor), that is, the right to buy or sell a specified number of stocks or ETFs from the option seller at the agreed time and price. Of course, the buyer (obligee) can also choose to give up exercising his rights. If the buyer decides to exercise his power, the seller is obliged to cooperate.