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About Options

Options play an important role in modern financial markets. Originating in 1973 in Chicago, exchange traded options have developed rapidly in both turnover and sophistication.

Options can be used:

  • to increase the return on a share portfolio
  • to hedge against potential losses, i.e. to act as risk reduction
  • for trading purposes

Correctly used, options can be a versatile business alternative. However, both the purchase and sale of options involves risk and may not be suitable for everyone. Option transactions should only be entered into when the nature and the extent of the rights and obligations are understood, and with full awareness of the risks related to trading options.

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