Replies

To: Toddsterpatriot

How does an option buyer make money? Who does he buy the option from?

From an institution that is usually not in the possesion of the underlying good.

21 posted on 01/21/2008 8:40:52 AM PST by Rummenigge (there are people willing to blow out the light because it casts a shadow)

To: Rummenigge

It’s all on a piece of paper. As money is.

22 posted on 01/21/2008 8:41:39 AM PST by Rummenigge (there are people willing to blow out the light because it casts a shadow)

To: Rummenigge

From an institution that is usually not in the possesion of the underlying good.

So the buyer makes $2 when the underlying goes from $10 to $12 and the seller loses $2.

24 posted on 01/21/2008 8:45:43 AM PST by Toddsterpatriot (Why are protectionists so bad at math?)

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