About Trading Options - MF Global Futures broker, Futures trading, CFD trading, online Futures trading

About Trading Options

An option is simply the right, but not the obligation, to buy or sell something at a pre-determined price at any time within a specified time period.

This contract or option gives the buyer the right, but not the obligation, to buy or sell a particular commodity (futures contract) at a certain price for a limited period of time. The option seller, on the other hand, is obligated by this same agreement to buy or sell the commodity stated in the contract, at a certain price, if the option is exercised by the option buyer.

There are two distinct types of options

Put Option - Call Option

A put option gives the option buyer the right to sell the underlying commodity, while a call option gives the option buyer the right to buy the underlying commodity. In case of options on futures, the underlying commodity is a futures contract.

To learn more, register to receive the 21 Options Strategies booklet.

Disclaimer: This website contains general information only and does not constitute financial product advice. Derivative products can be risky and are not suitable for all investors. MF Global Australia recommends customers seek independent advice. A MF Global Australia Product Disclosure Statement (PDS) is available through the website www.mfglobal.com.au and should be considered prior to trading MF Global's derivative products. Investing in derivatives carries a high level of risk to capital, and due to the potential volatility and fluctuations in value, investors may not get back the amount of their original investment. In certain circumstances an investor may be liable to pay a far greater sum, with losses being higher than an initial deposit.