Put Option
Right to sell a given security at a stipulated price until a future expiration date. For example, assume the "None-Do-Well" company's stock has a market value of $20. Investor A sells Investor B an option (right) to buy Investor A's shares in the "None-Do-Well" company at a price of $25, good until 60 days hence. Investor B pays a premium of $4 per share for this right. If the stock's market value increases to a price greater than $29, Investor B will make a profit on the transaction. If, however, the stock falls below its original price of $20, Investor A will keep the stock as well as the $4 premium right per share it received from Investor B. If the 60-day limit expires without the right being executed, the option becomes void and worthless.
Popular Insurance Terms
The term pro rata comes from Latin and translates to in proportion, proportionally, the proportion of, proportionately determined, or according to a specific rate. It is often used in legal ...
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Arrangement whereby the insured pays the insurance company a relatively small monthly premium payment. In exchange for this premium payment, the insurance company processes and pays claims ...
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