OTCPK:CPPMF - Post by User
Comment by
gloxinia123on Aug 05, 2011 2:55pm
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Post# 18909621
RE: RE: RE: WOW am i good trader
RE: RE: RE: WOW am i good traderBuyer and seller interest decides whether a sp goes up or down. But options prices are CALCULATED based on a number of factors. You can buy or sell as many contracts as you want without affecting the premium received or paid. The further out the option, the less a small move in the absolute amount of the underlying sp affects the option price. I wouldn't expect the premium of a 3 month out option to change more than 5-10 cents when the sp goes from 6.20 to 5.85.
The Montreal Exchange has some excellent information to help people understand option pricing.
https://www.m-x.ca/f_publications_en/en.guide.options.pdf