Option trading is a highly risky trading product. Before you trade, please read the option risk disclosure in detail .
1. Option introduction
Option ( Option ) is a right to choose, which refers to the right to buy or sell a certain amount of a certain commodity at a certain price at a certain time in the future. It is a financial instrument generated on the basis of futures, giving the buyer (or holder) the right to buy or sell the underlying asset . The holder of an option can choose the right to buy or not to buy, sell or not to sell within the time specified by the option, and to implement the right or waive the right, while the seller of the option only bears the provisions of the option contract Obligations.
2. Option classification
( 1 ) According to the rights of options, there are two types of call options and put options:
i. call option ( Call Options ), is the right option to buy gold sellers direction option to pay a certain amount of after that has in the life of the option contract, according to a pre-agreed price to buy a certain number of options contracts to the option writer The rights of specific commodities stipulated, but not the obligation to buy. The option seller is obliged to sell the specific commodity specified in the option contract at the price specified in the option contract at the request of the option buyer during the validity period specified in the option contract;
ii. put option ( of Put Options ), is the right option to buy gold sellers direction option to pay a certain amount of after that has in the life of the option contract, according to a pre-agreed price of the put option seller to a certain number of The rights of specific commodities stipulated, but not the obligation to sell. The option seller is obliged to purchase the specific commodities specified in the option contract at the price specified in the option contract at the request of the option buyer during the validity period specified by the option.
( 2 ) Divided by the delivery time of the options, there are two types of American options and European options:
i. American option means that the right can be exercised at any time during the validity period specified in the option contract;
ii. European-style options means that the rights can be exercised on the expiration date specified in the option contract. The buyer of the option cannot exercise the rights before the expiration date of the contract. After the expiration date, the contract will be automatically invalidated.
( 3 ) According to the classification of the target on the option contract, there are stock options, stock index options, interest rate options, commodity options, and foreign exchange options.
3. Important terms for options
( 1 ) exercise price ( Strike Price , also known as the " strike price " ), if X stock price to HK $ 10 , you buy a HK $ 15 call option, HK $ 15 is the exercise price.
( 2 ) the implementation date ( Expiration a Date , also known as the " exercise date " ), if you buy a 2020 Nian 9 Yue 29 day expiration option, then this is the day the exercise date.
( 3 ) Open Interest : The number of contracts that have not expired or been executed.
( 4 ) Contract ( Contract ), the unit of option is contract, usually each contract is the right of 100 shares.
4. Common problem
( 1 ) What is the smallest unit of Hong Kong stock options trading?
The minimum unit of Hong Kong stock options trading is 1 contract. The number of underlying shares corresponding to an option contract = the number of underlying shares per lot * the multiple of underlying stock trading unit. For example, Xiaomi’s “ primary stock trading unit multiple ” is 5 , and each underlying stock is The number of lots is 200 , so the number of underlying shares corresponding to an option contract is 1000 .
( 2 ) What are the commission fees for options?
0.2% of transaction amount , minimum 3 HKD per order .
( 3 ) What is the trading time of options?
The trading hours of options are 9:30 to 12:00 and 13:00 to 16:00 Beijing time .
( 4 ) Can options be exercised in advance?
Currently, TIGER TRADE client does not support early exercise.
( 5 ) Can the purchased option be closed at any time before the expiry date?
Options before the expiry date, whether long or short, can be traded at any time at the market price during the trading hours before the expiry date.
( 6 ) How will in-the-money options deal with options without active exercise or liquidation on the expiry date?
Stock options that expire on the same day and reach 1.5% or more of the exercise price will be automatically exercised, but when the investor’s margin does not meet the exercise conditions, the position will be closed at the market price. If the position cannot be closed at the market price due to insufficient liquidity and other reasons, Tiger reserves the right to void the option. This process will cause the entire value of the option to be abandoned.
( 7 ) Will the automatic invalidation of options, liquidation and system exercise be found in the transaction records?
Yes, you can click on the order details to view related records and instructions.
( 8 ) Do you support short trading of Hong Kong stock options?
- Forced liquidations prior to expiration,
- Allow the options to lapse,
- Allow options to be exercised and liquidate other positions.