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Option Holder

Updated on March 15, 2023

Option holder is a person who has an option which has not been exercised yet. An options contract is a financial contract which gives the investor or its ‘holder’ a ‘right’, but not an ‘obligation’ to either buy (call option) or sell (put option) an asset at a predetermined price on a specific date. There are two parties involved in the options contract: a buyer, called the option holder and a seller who is referred to as the ‘writer’. The option lapses and there is no settlement required, if the option holder does not exercise this right to buy or sell.