Describe the most common types of stock options and their ch
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Describe the most common types of stock options and their characteristics.
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This solution describes the most common types of stock options and their characteristics.
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By definition, stock option is a contract which gives its holder the right, but not an obligation, to buy or sell shares of the underlying security at a given price within a specific period or on a specific date. Stock Options are very versatile and are very attractive to many investors. There two types of options, calls and puts. A call option enables the holder to buy the security while a put option enables the holder to sell the security.
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