Chapter 04 · Section 4.1

Option Holder

As far as the trading mechanism is concerned there is no difference between a stock exchange and an options exchange. But there is one in another area ...

Assume you are the holder of an exchange traded option. How do you prove that you are the option holder?

• a) Every option holder receives a paper which states his rights (just like a bearer share) from the exchange.
  No. Distributing certificates would be too difficult given the trading volume of an options exchange. At any rate, certificates are normally written by the obligated party, not an exchange.
  b) Every option holder receives a paper which states his rights (just like a bearer share) from the option writer.
  c) The exchange must keep a register of all option holders and writers.
  d) Your broker enters your position in an account. He, in turn, has an account with the clearing house, or with somebody who has one.

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