Question

when does the buyer of a call option's relevant interest on shares arise? when the contract...

when does the buyer of a call option's relevant interest on shares arise? when the contract entered or when the option is exercised? Is it different for options traded on exchange and those that are not and why?

Homework Answers

Answer #1

Warrants and call options are both types of securities contracts.

A warrant gives the holder the right, but not obligation, to buy common, shares of stock directly from the company at a fixed price for a pre-defined time period.

Similarly, a call option (or "call") also gives the holder the right, without the obligation, to buy a common share at a set price for a defined time period.

The call option's relevant interest on stock arise just before option expiry

Exchange traded options are issued by an exchange such as the Chicago Board Options Excange in the U.S or the Montreal Exchange in Canada

In India we have different Brokering firms who issue call options. The optons expires or matures based on the conditions.

There is no such difference accept the tuypes like Warrents and Call options.

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