Question
A registered representative is introducing options terminology to a client. Of the following, which explanation regarding owners and writers of listed equity option call contracts
A registered representative is introducing options terminology to a client. Of the following, which explanation regarding owners and writers of listed equity option call contracts would be true?
A) The owner of a call is obligated to exercise the contract to sell shares to the writer, who may choose to purchase them or not.
B) The owner of a call has the right to exercise the contract, and the writer would then be assigned and obligated to sell shares to the owner at the strike price.
C) The owner of a call has the right to exercise the contract, and the writer would then be assigned the obligation to buy shares from the owner at the strike price.
D) The owner of a call has the right to exercise the contract, and the writer would then have the right to buy shares from the owner at the strike price.
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