Define the Term "Option Writer" or "Seller." ⎊ Path

Define the Term “Option Writer” or “Seller.”

The option writer is the party who sells the option contract and receives the premium from the buyer. By selling, they take on the obligation to fulfill the contract if the buyer chooses to exercise.

The writer's maximum profit is the premium received, but their potential loss can be unlimited (for a naked call).

Explain the Concept of “Assignment” for a Covered Call Writer

How Does the Lack of Obligation Differ from a Futures Contract?

What Is the Primary Motivation for an Option Writer?

What Is the Difference between a Covered and a Naked Option Writer?

What Is the Difference between a ‘Covered Call’ and a ‘Naked Call’ Strategy?

What Is the Counterparty Risk Associated with Decentralized Crypto Options Platforms?

In Both Cases, Who Is the Party That Assumes the Risk?

How Do Options Differ from Futures in Terms of Obligation?

Glossar

Option Writer

Exposure ⎊ An option writer, within cryptocurrency derivatives, assumes an obligation to fulfill the underlying asset or cash flow contingent upon the option holder’s exercise of their right.