Day trading in Singapore is a popular and lucrative money-making opportunity. Traders have at their disposal many financial assets that they can trade to make good profits.
One of the assets categories that not many traders know is listed options.
- 1 What is the listed option?
- 2 What are the features of a listed option?
- 3 Cost-effectiveness
- 4 The obligation of the holder of the option
- 5 Expiration period
- 6 Style
- 7 Sold over the counter
- 8 Why trade listed options with Saxo?
- 9 Years of experience
- 10 Numerous listed options to trade
- 11 Advanced option tools
- 12 Affordable convenience
- 13 Conclusion:
What is the listed option?
In financial trading terms, an option is a contract that allows the holder the right to buy or sell a particular asset at a particular price before a stipulated date. However, the obligation to exercise this right lies with the option holder.
An option that is listed and can be publicly traded on a securities exchange is a listed option.
What are the features of a listed option?
Options contracts are based on an underlying asset. As such, when an investor buys an option, they are buying into an asset without having to pay the full price of the asset. Depending on the price of the asset, the holder of the option now has the choice of whether to exercise the option or not.
The amount an investor pays for the options is known as premium.
The obligation of the holder of the option
As a purchaser of the listed option, you have the right to buy or sell the underlying asset but not the obligation to do so. This means that you do not have to exercise your right to buy or sell.
Listed options are only valid for a certain stipulated period. If you do not exercise your right to buy or sell within this period, you can’t do it any other time.
Styles in listed options refer to the manner in which the option can be exercised.
There are two significant option styles. An American style option is an option that can be exercised at any time within the stipulated period of the contract.
A European style option can only be exercised at a specified time, which is usually at the end of the contract.
Sold over the counter
Listed options are sold over the counter and thus have low liquidity. To get around this challenge when trading in Singapore, it is important that you access the market through a stable and reputable market intermediary such as Saxo Capital Markets.
Why trade listed options with Saxo?
Years of experience
As a financial intermediary in Singapore, Saxo has assisted many traders and investors access the markets and make high profits.
They have highly advanced platforms for traders to use when trading. They are regulated by the relevant government authorities and have served the finance industry for over two decades.
Numerous listed options to trade
When you use Saxo, you have access to over 1000 listed options that you can invest in. This means that, rather, than get stuck on low liquidity options, you have hundreds to choose from that have varying investor interest.
This ensures that you will have put your money to good use and will reap in the profits that you will make from your trades.
Advanced option tools
As a participant in the financial markets, you need all the tools you can get to make your investment and trading activities fruitful.
Saxo provides tools that help you analyze your investment in limited options prior to your purchasing them. This means that you can then confidently place your order for the listed options knowing that you are not staring at a loss.
With access to over 1000 listed options, you can trade-in as many as possible. As an enabler of your trading and investing activities, Saxo will charge you based on the volume of your transactions, to ensure that you make a tidy profit.
Listed options are an investment category that traders in Singapore should focus on. It does not require high levels of capital and is likely to offer a great return with a large number of listed options available to buy.
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