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Glossary of Options Terms -- A

Accumulation - When stocks start moving sideways after a significant drop as investors start accumulating.

All-or-None (AON) Order - An order that must be completely filled or else it will not be executed. This is a useful order for option traders executing complex option strategies which needs to be precisely filled. Types Of Options Orders Explained.

American-Style Option - An option contract that may be exercised at any time between the date of purchase and the expiration date. Most exchange-traded options are American-style. Learn Everything About Stock Options.

Arbitrage - The simultaneous purchase and sale of financial instruments in order to benefit from price discrepancies. Option traders frequently look for price discrepancies of the same option contract between different option exchanges, thereby benefiting from a risk free trade. Read more about Options Arbitrage.

Ask Price- As used in the phrase 'bid and asked' it is the price at which a potential seller is willing to sell. Another way of saying this is the asking price for what someone is selling. You buy option contracts and stocks on their Ask price.

Assign - to designate an option writer for fulfillment of his obligation to sell stock (call option writer) or buy stock (put option writer). The writer receives an assignment notice from the Options Clearing Corporation.

At the Money - When an option's strike price is the same as the prevailing stock price. Read More About At The Money Options.

Automatic Exercise - A protection procedure whereby the Options Clearing Corporation attempts to protect the holder of an expiring in-the-money option by automatically exercising the option on behalf of the holder.



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