by Girl Banker
Options are financial products that derive their value from a change in the value of another underlying product. Options can be bought on many underlying products including but not limited to:
An option is a type of derivative. A derivative derives its value from a change in the value of another underlying product. All options give the buyer the right but not the obligation to do a given thing at a given time.
Essentially, options can be viewed as insurance contracts. You get paid if a certain undesirable event happens. The price or cost of an option is called the premium.
Extracted from To Become an Investment Banker
I created my investment banking blog in 2012 as soon as I resigned from i-banking & published my book, To Become An Investment Banker.
Initially published at girlbanker.com, all posts were later subsumed into my personal website under katsonga.com/GirlBanker.
With 7 years of front office i-banking experience from Goldman Sachs and HSBC, in both classic IBD (corporate finance) and Derivatives (DCM / FICC), the aim of GirlBanker.com was to make it as straight-forward as possible to get into a top tier investment bank.
I'm also a CFA survivor having passed all three levels on the first attempt within 18 months - the shortest time possible.