Part 5 Institutional Trading

Types of Options
American vs. European Options
American Options: Can be exercised anytime before expiry.

European Options: Can only be exercised at expiry.

Index Options vs. Stock Options
Stock Options: Based on individual stocks (e.g., Reliance, Infosys).

Index Options: Based on indices (e.g., Nifty, Bank Nifty).

Weekly vs. Monthly Options
Weekly Options: Expire every Thursday (India).

Monthly Options: Expire on the last Thursday of the month.

Key Players in the Options Market
Option Buyers (Holders): Pay premium, have rights.

Option Sellers (Writers): Receive premium, have obligations.

Retail Traders: Use options for speculation or hedging.

Institutions: Use advanced strategies for income or risk management.