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The call option that is in the money is equivalent in payoffs to the put option that is out of the money. 1. Payoffs are always greater than profits in dollar long amounts when the option is taken 2. 3. The put option writer (seller) is obligated to sell the stock to the other party if option is exercised by the other party The listing of individual stocks is decided in such a way that an exchange drafts a 4. proposal and applies to the SEC for permission to trade the option. S. Higher margin is required for a short position in an option when the option is at- the-money Consider two put options differing only by exercise price. The one with the higher exercise price will have a greater profit potential. 6. Sellers of an option with maturity less than 9 months are required to post a full margin. 7. A call option writer owning the stock against which the option is written can satisfy the margin requirement simply by allowing a broker to hold the stock in the brokerage account. 8. 9. On October 23, Intel option that is assigned to the February cycle will have expiration months of November, December, February, and May. 10. A synthesis of shorting a put and a stock is essentially equivalent to a long call i payoffs