The DICT Development Group
1 definition found
for Seller''s option
From The Collaborative International Dictionary of English v.0.48 :
Option \Op"tion\, n. [L. optio; akin to optare to choose, wish,
optimus best, and perh. to E. apt: cf. F. option.]
1. The power of choosing; the right of choice or election; an
There is an option left to the United States of
America, whether they will be respectable and
prosperous, or contemptible and miserable, as a
2. The exercise of the power of choice; choice.
Transplantation must proceed from the option of the
people, else it sounds like an exile. --Bacon.
3. A wishing; a wish. [Obs.] --Bp. Hall.
4. (Ch. of Eng.) A right formerly belonging to an archbishop
to select any one dignity or benefice in the gift of a
suffragan bishop consecrated or confirmed by him, for
bestowal by himself when next vacant; -- annulled by
Parliament in 1845.
5. (Stock Exchange) A stipulated privilege, given to a party
in a time contract, of demanding its fulfillment on any
day within a specified limit; also, the contract giving
that privelege; as, an option to buy a stock at a given
price; to exercise an option.
[1913 Webster +PJC]
Note: A person owning a stock may sell to another person an
option or right to buy that stock at some specified
price within a specified period of time, and in return
will get a premium in consideration for giving the
option. If the option price (the strike price) is above
the market value for the entire period in which the
option is valid, the option is typically not exercised,
and expires with no need on the part of the stock owner
to transfer the actual stock itself. If however the
stock price rises above the option price, the holder of
the option may exercise the option, and buy the stock
at the specificed price, and may in turn resell the
stock at the current market value, perhaps making a net
profit on the transaction. The original holder of the
stock will receive, in addition to the price at which
the stock is sold, the price of the option, and will
generally receive more money than if the stock itself
were sold at the time that the option was sold. The
actual profits for the transaction will depend on the
fees that brokers charge for conducting the sales of
options and stocks.
Buyer's option, an option allowed to one who contracts to
buy stocks at a certain future date and at a certain
price, to demand the delivery of the stock (giving one
day's notice) at any previous time at the market price.
Seller's option, an option allowed to one who contracts to
deliver stock art a certain price on a certain future
date, to deliver it (giving one day's notice) at any
previous time at the market price. Such options are
privileges for which a consideration is paid.
Local option. See under Local.
Syn: Choice; preference; selection.
Usage: Option, Choice. Choice is an act of choosing;
option often means liberty to choose, and implies
freedom from constraint in the act of choosing.
Questions or comments about this site?