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Strike Price in Options

 

The strike price is the fixed price of a option. In other words the strike price is the price at which the buyer of an option will pay for the underlying stock shares if the buyer chooses to exercise the rights granted by the option.

 

The strike prices of options are usually available in increments of 2.5, 5, and 10 points depending on the underlying stock on which the options depend.

 

For example, the options for Waste Management Inc (WMI) may be listed as 30, 32.5, 35, 37.5, depending on the market conditions, option expiration date, and various other factors.

 

 

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