Sentences with phrase «obligation of the short position»

That means if you write a call, you'll have to keep a balance in your account to cover the risk associated with the current obligation of the short position.

Not exact matches

Covered options: A short options position in which the writer has the means of meeting the obligation.

Assign To make an option seller perform his obligation to assume a short futures position (as a seller of a call option) or a long futures position (as a seller of a put option).

Risks associated with derivatives (including «short» derivatives) include losses caused by unexpected market movements (which are potentially unlimited), imperfect correlation between the price of the derivative and the price of the underlying asset, increased investment exposure (which may be considered leverage), the potential inability to terminate or sell derivatives positions, the potential need to sell securities at disadvantageous times to meet margin or segregation requirements, the potential inability to recover margin or other amounts deposited from a counterparty, and the potential failure of the other party to the instrument to meet its obligations.