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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: i-node who wrote (141843)	1/18/2002 11:43:12 AM
From: tejek	Read Replies (1) \| Respond to of 1584596

It's fairly simple. A call gives you the right to purchase 100 shares of stock at a particular [strike] price between now and expiration. So, if you have a July 17.5 call, that means you can force someone to sell you 100 shares of the underlying stock at $17.50/share anytime between now and the July expiration date. Puts are the opposite (they allow you to force someone to BUY the stock at a fixed price). Strike prices are set by the exchange. In general, as a stock moves up in price the exchange will open trading on higher strikes; as it moves lower the lower strikes will open. My original question had to do with a strike price. Do all the puts and calls taken out on a stock yield a strike or average price you can expect the stock to close at on expiration which happens to be today? If so, would Max Pain provide such a price? TIA.