Option Terms - Letter A

  • American Option
    These options can be excercised any time before expiration. This is opposed to a European Option, which can only be excercised at expiration.
  • Arbitrage
    Taking on multiple positions in a security in order to profit from a mispricing in a financial instrument. Many people will use options to construct a position in the underlying security to do this.
  • At The Money
    This is when a put or call options strike is the same as the underlying price. A call option with a strike price of 25 is "at the money" when the underlying stock, etf or index is trading at 25.

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