asx/chess holding statements, page-2

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    cmhan

    Chess HOLDING statements are just that ..for shares you HOLD

    Options are a derivative product.

    Options mean you do not hold shares, so no holding statement is issued.

    A bought option is an option or choise to buy/sell the shares....
    If the option is exercised, then a holding statement will be issued

    A sold option is an obligation to buy /sell shares if the option you have sold is exercised by a purchaser.
    Once again a holding statement would be issued after the actual shares changed hands.

    In more detail:

    If you buy a CALL option, you have a right, but not an obligation, to buy the shares at the agreed option price up until the expiry of the option
    If you sell a CALL option, you have the obligation to supply the shares if called upon to do so.

    A bought PUT option gives you the right, but not the obligation, to sell shares at the price agreed to in the option, up until the option expires.
    A sold PUT option gives you the obligation to buy shares as per the option at the agreed price, up until option expiry

    Your options broker should give you appropriate documentation of your position at the time you made the original transactions.

    And remember, if no action is taken to exercise the option, it eventually expires with no further rights or obligations to either the buyer or writer. In such case no shares change hands, so again no holding statement will be issued.

    Hope this helps.

    Cheers

    Bendigo
 
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