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.
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.
  No. That would mean that the exchange must keep the addresses of every single customer and make a credit risk analysis for every single one of them.
  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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