Economics Options And Futures Questions
The strike price in options trading refers to the predetermined price at which the underlying asset can be bought or sold, depending on the type of option. It is the price at which the option holder has the right to exercise their option contract. The strike price is set at the time of the option's creation and remains fixed throughout the life of the option. The relationship between the strike price and the current market price of the underlying asset determines the profitability of the option.