I don’t trade options so don’ t know much and would like to confirm: Is one option contract = 100 shares? Is this generally or always? when I read say call price = $0.10 and if I buy 10 contract am I buying equivalent of 1000 shares for $0.1 x 10 x 100 = $100?
Thanks much ws! I am assuming 1 contract=100 is for all stocks and there are no exceptions.
Usually it’s 100 shares. When there’s splits, reorgs, spin-offs, etc., the deliverable can be a lot different: Cash in lieu, 120 shares X, 50 shares Y, for example…
^Good point. if a stock in going under any merger, reorg, spinoff…the option will have NS (non-stardard) shares.
Here’s a good example: http://finance.yahoo.com/q/op?s=WLT&m=2009-01 You’ll notice there’s 2 of the same strike, but completely different prices… Here’s the deliverables: http://www.optionsclearing.com/market/infomemos/2007/jan/22488.pdf Here’s the main site that is helpful: http://www.optionsclearing.com/market/infomemos/info_memos_form.jsp
Thanks for the info soxboys21! I learned something new today. So 1 ZSEAF.X contract buys 100 WLT + 165 MWA.B + $3.59, is that right?