asc, page-2

re: asc - how options work for smokey10
Hi,

Basically options are the right to buy a share up to a certain date, for a fixed amount.

In this case your options will allow you to buy a share in ASC for 10c per share by the specified date.

The options themseleves will trade and have value, they will generally track around the excercise price of the option below the full share price.

So what will happen here ?

10c options will trade approximately 10c below the full share price, so if the share price is say 11c then the option will be around 1c if you wanted to sell them.

At times option will either lead the share or lag the share ie if the share price is 11c and the option is trading at 5c then the market believes ( or a least some punters do) that the share price will rise above 15c by the excercise date to make it worthwhile to pay your 10c per share.

Hope this makes some sense

D