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I think I have explained that an option can be traded as a stock or any other instrument in about 10 different ways yet you still seem to be surprised when someone 1 or 2 posts ago said that you can sell the option in the market without ever exercising it. Maybe this will help. When you buy...

It's the same as any instrument. When you buy/sell something you pay the market price. If the price you sell at is higher than the price you bought it for then you have a profit otherwise you have a loss. Think of the premium as the market price of an option.

It wasn't my intention to insult you. I'm just pointing out that you need to read a few books/visit educational sites to a get basic understanding of options. Once you have it you will be in a position to understand my explanations. As to my remark regarding the options course. What I meant...

The first trade where you buy the 65 put and sell the 64 put is a bearish trade where you want the stock to be below 64 to make the max profit, and if it is above 65 then you lose the premium paid. The second trade is a bullish one. Here's what I think you were trying to say. A debit call...

With all these posts you give the impression that you have uncovered some conspiracy or some secret info. All of the stuff in these agreements is pretty standard for a spot FX market, which is an OTC (over the counter) market. Anyone who is not aware of this stuff has no business trading spot FX.

Based on your replies I see that you still lack the basic understadning of options so I suggest you visit some educational sites such as Options Industry Council. You do not need to cover the option's premium to make money. Here's one last try from me. You buy an at-the-money call option...

Think of it this way. Prior to expiration you can buy/sell your option at the market price so your P/L will be determined by that price. As the stock goes up/down the option prices will change according to the relative impacts of delta (stock price change), theta (time to expiration) and vega...

The basis for any capital guarantee trade is very simple. Buy a zero coupon bond that matures on the required date and invest the amount that would produce your intial capital on maturity. Whatever is left is your risk capital that you can invest any way your like (the catch is that you cannot...

It's not that straightforward as the relationship is a bit more complex. However, to generalize, the longer you hold the option the more the stock has to move to counter the time decay effect. For example, if you buy an at-the-money call option with 1 month to expiration today and tomorrow...

It's the same as with stocks. You buy something at one price (in case of options it is the premium you pay) and then you compare it to the current market price to determine your open P/L. The above applies prior to expiration. At expiration the option is either worth zero or the difference...

With stocks you only need to get the direction right. With options you need to get the direction right (or lack thereof), timing of the move as well as volatility. Get one of them wrong and you may lose money. So just because you are profitable with stocks doesn't automatically mean you will...

It's a market maker not a marked maker.

Stock trades settle T+3 and there's no way around this. If you want instant access to the proceeds then you need to open a margin account.

One thing to keep in mind is that the decay takes place before the actual weekend so if you want to take advantage of that you need to be early, sometimes a couple of days early.

You forgot to take into account the dividends. Also, futures trade at a discount to the spot because the dividend yield (currently at around 2%) is greater than the risk free rate. Doing a manual rough calculation with 150 days for Jun futures I get a discount of 8.14 pts to the spot price...

No worries. Btw, the ticker for the settlement for NDX is NDS, for SPX it is SET, and for DJX it is DJS.

You can always look those up on Yahoo!Finance or any other site. The ticker for RUT settlement is RLS and it's 649.05.

You are not missing anything. Your calculations are correct. All that is left is for the stock to go up. By the way, you can also buy the 4 call and sell the 5 call and have the exact same profile. The benefit is that the calls are OTM and they are more liquid.

Yes, there are options on VIX. However, and this is a very important point, options are not on the spot VIX but on the futures. For more discussion on this use the search button or just go through the Options forum.

There are market makers, who will quote the options accordingly.