# How to sell options contracts?

Business, Finance, Investment @ 26 March 2016

There are essentially two methods, which you can sell options agreements. If you have formerly purchased agreements and desire to understand your earnings, or cut your losses, then you would sell them by putting a sell to close order. Because you are closing your position by selling options agreements, the order is called as such.


You would normally use that order if the options you owned and operated had risen in value and you wished to take your revenues at that point, or if the options you owned and operated had fallen in value and you wished to leave your position before sustaining other losses.

The other way you can sell straddle option steadyoptions.com is by opening a short position and short selling them. This is likewise called writing options because the procedure, in fact, includes you writing new agreements to be offered in the market. When you do this you are handling the responsibility in the agreement i.e. if the holder decides to exercise their option then you would have to sell them the underlying security at the strike rate (if a call option) or buy the hidden security from them at the strike rate (if a put option).

Writing options is done using the sell to open order, and you would get a payment at the time of putting such an order. This is usually riskier than trading through buying and after that selling; however, there are revenues to be made if you know what you are doing. You would place such an order if you thought the hidden pertinent security would not move in such a way that the holder would have the ability to exercise their option for earnings.