HOW A STOCK AND OPTION ARE LINKED – Lesson 6

The option market is the stock market’s central nervous system. How an Option Contract andUnderlying Stock are linked: One Option Contract = 100 Shares of Stock Options are “Derivatives” – meaning they “DERIVE” their value from the underlying stock. An option is just a paper contract.That contract must be LINKED to astock of some company, which is called theUNDERLYING STOCK. Underlying stock: “Without me, you’re … Continue reading HOW A STOCK AND OPTION ARE LINKED – Lesson 6