If the seller does not own the stock when the option is exercised, he is obligated to purchase the stock from the market at the then market price
This term most often describes the purchase of an option or stock to close out an existing short position for either a profit or loss Options Glossary. The volume and open interest of each stock options contract provide an indication on their liquidity, making it important to completely understand them.
Incentive Stock OptionISO) read the definition of Incentive Stock OptionISO) and 8 000+ other financial and investing terms in the Financial Glossary. An employee stock optionESO) is a privately awarded call option Basics of Employee Stock Options and How to Exercise Them An employee stock option.