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TRADING #101 COURSE – PART II TWO: SUCCESSFUL TRADING PIE – WWW.TRADERSCOACH.COM

An option can usually be sold by its original buyer to another party. Many options are
created in standard form and traded on an anonymous options exchanges among
members of the public, whereas other over-the-counter options are customized ad hoc
to the desires of the buyer, usually by an investment bank.

There are many options that can be traded:
▪ Stock options.
▪ Commodity options.
▪ Bond options.
▪ Index options.
▪ Exchange-traded fund (ETF) options.
▪ Credit options.
▪ Options on futures contracts.

Options Symbology

Options contracts are identified with symbols and codes that are different from, say,
stocks. On February 12, 2010, the five-character OPRA code ticker format stopped
being used in the US and Canada.

The new Options Clearing Corporation's (OCC) standard is now fully in place.
Options Clearing Corporation's (OCC) Options Symbology Initiative (OSI) mandated on
February 12, 2010, an industry-wide change and a new option symbol structure,
resulting in option symbols 21-characters in length.
The 21-character OSI identifier has six data elements arranged in a logical order. These
data elements are: 1. Underlying asset; 2. Expiration year; 3. Expiration month; 4.
Expiration day; 5. Option type put or call; and 6. Strike price.
The Symbology Key defines each of the data elements, and shows the minimum data
set required for transmission of listed options contracts between exchanges, the
clearinghouse and their constituents.
These symbols consist of four parts:

1. Underlying Asset: Root symbol of the underlying asset padded with
spaces to 6 characters
2. Contract Expiration Date: 6 digits in the format yymmdd
3. Option type: either P or C, for put or call
4. Strike price: as the price x 1000, front padded with 0s to 8 digits

Example: This 21-character symbol below represents a PUT on SPX, expiring on
11/22/2014, with a strike price of $19.50.

SPX /141122/P/00019500

Underlying asset / Expiration – yymmdd / Type / Price

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