|
|
Option Strike Price
|
The strike, or exercise, price of an option is the specified
share price at which the shares of stock can be bought or sold by
the buyer if he exercises the right to buy (in the case of a call)
or sell (in the case of a put).
A strike price is the actual numeric value
of the option. For example, a April option may have strike prices
of 25, 30 and 35. Strike prices are determined when the underlying
reaches a certain numeric value and trades consistently at or
above that value. If, for example, XYZ stock was trading at
29, hit a price of 30 and traded consistently at this level,
the next highest strike may be added. |
|
|
|
 |
|
