Section 11 Tutorial. What is the option game? It’s an investment strategy that involves paying for the right to buy or sell stock or futures at a particular price over a given time, or selling the right to someone else to buy or sell stock or futures for a particular price over a given time. | Section 11 Ti t ì i ial TUTORIAL What is the option game It s an investment strategy that involves paying for the right to buy or sell stock or futures at a particular price over a given time or selling the right to someone else to buy or sell stock or futures for a particular price over a given time. Simple Actually yes. However there is a bit of pretending going on. Most of the investors only pretend to want to buy or sell the stock they control. What they are really doing in this game is betting a particular stock or futures price will go up or go down. That bet is called an option and the casino palaces are options exchanges the first constructed in the early 1970 s. You can play the part of the tourist or the casino owner. Want to play Before you can learn the tricks of the trade you have to know the game and that is what this section is all about teaching you the basics of option trading. The good stuff comes later. Let s begin. Throughout the tutorial we will use stocks to explain option trading but keep in mind that what applies to stock and stock options applies to futures and futures options. The Listed Option The first step in becoming an effective option player is to gain a complete understanding of the focal point of the game the listed option. A listed option is a stock option remember think futures too and an option is simply a contract one that gives you the right to buy or sell 100 shares of stock at a specific price for a specific period of time. While stock options have been .
