Equity Options

As NASDAQ OMX continues to build client synergies and efficiencies, it is in the process of migrating the Phlx.com website content into various NASDAQ OMX websites. As a first step of this initiative, Equity Options Information has been migrated to the NASDAQtrader.com website. Please use this link http://www.nasdaqtrader.com/Micro.aspx?id=phlxequityoptions to access this information.

Options are flexible financial tools that assist investors in managing investment portfolios. Options can protect stock holdings from a decline in market price, increase income from current stock holdings and position an investor to buy stock at a lower price or sell stock at a higher price. Investors can also utilize options to position themselves for large market moves and benefit from a stock price's rise or fall without incurring the cost of buying or selling the stock outright.

A stock option is a contract which conveys to its holder the right, but not the obligation, to buy or sell shares of the underlying security at a specified price on or before a given date. This right is granted by the seller of the option.

There are two types of options, calls and puts. A call option gives its holder the right to buy an underlying security, whereas a put option conveys the right to sell an underlying security.

For more information about equity options, obtain a copy of Understanding Stock Options. This publication is also available in hardcopy from your broker, the PHLX and any of the exchanges on which options are traded. The Options Industry Council (OIC) is also an excellent resource for additional options information.