answersLogoWhite

0

You receive option premium when you sell an option contract to another investor. The premium is the amount of money you receive upfront for taking on the obligation of the option contract.

User Avatar

AnswerBot

5mo ago

What else can I help you with?

Related Questions

How is the option premium taxed?

The option premium is taxed as a capital gain when the option is sold or expires.


What happens when you sell a put option?

When you sell a put option, you are agreeing to buy a specific stock at a predetermined price (the strike price) if the option buyer decides to exercise the option. In exchange for selling the put option, you receive a premium from the buyer.


Is the seller of the option retains the option premium whether or not the option is expired?

Yes, as soon as the option is sold on the open market to a buyer, the seller immediately receives and retains the option's premium. This premium is kept regardless of the action of the market or the buyer. In the event the option expires worthless, the premium becomes profit for the seller, or in contrast, the premium can be used to help offset loss if the seller decides to close the position and buy back the option. It is important to note, however, that the premium received remains in escrow and cannot be used in any capacity until the risk taken on by the trade is eliminated in due course by either the expiration of the option, or the buy back of the position.


When company issues shares at a premium the amount of premium may be received by the company?

yes,the company can receive the amount of premium.


What are the two factors depend on expiration?

Expiration depends on the option premium and the intrinsic value. The option premium is the price paid for the option contract, while the intrinsic value is the difference between the current stock price and the strike price of the option.


What is a good alternative to Don Julio 1942 for a premium tequila option?

A good alternative to Don Julio 1942 for a premium tequila option is Clase Azul Reposado.


Does Capitol One offer a premium finance option?

No. This premium finance option is usually handled by another company. Capitol One does not lend funds for insurances such as life, etc. This is not the purpose of Capitol One. It is not a premium finance company.


When must a long call option be sold to collect the premium?

Whenever you want. You collect the premium at the time you sell the call.


Can you pay a one time fee for a life insurance policy?

Generally, most insurers do offer an option by which you can pay the entire premium at once. This is usually called, appropriately, "single pay". This is not applicable on all life policies.However, in most Ulip policies, Single Premium or one-time premium option is there. Specially in conventional policy, where single premium option is there, you gain by way of paying lesser amount in comparison to consolidated regular premium amount.


Who can give you a premium minecraft account?

Legally only minecraft.net/mojang can sell you a Premium account.unless you receive a gift code to upgrade to premium at the official website.


How do you get a Minecraft Premium account for free?

You'd have to receive it as a gift from someone.


Which of these is the best description of term insurance. purchased for a set premium cost with the option of paying in more?

purchased for a certain time period with a specific premium cost