An option contract is a derivative security that obligates the owner to purchase the underlying asset at a specified price on a specified day.

Name: An option contract is a derivative security that obligates the owner to purchase the underlying asset at a specified price on a specified day.
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Question

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An option contract gives the owner the right, but not the obligation, to buy or sell the underlying asset at a specified price before or on a specified date.

An Option Contract Is a Derivative Security That Obligates the Owner