4 ms·
> options are always more valuable than the underlying asset How about this deal: for any publicly traded stock you're holding, I'll give you an option to buy
by klochner 12y ago
> options are always more valuable than the underlying asset
How about this deal: for any publicly traded stock you're holding, I'll give you an option to buy an equivalent number of shares at current market price.
If the price goes down, your option is worthless but I can still sell the underlying. If the price goes up, I can sell for market price, while you net [market-strike] < market.
I enjoy startups. They can be great learning opportunities, but they're typically a losing bet financially. You have to choose wisely.
- Ntrails 12y agoThe difference is in the starting value. You might pay pounds for the underlying and pennies for the option. But no, 1 long option is never more valuable than 1 share.