Optionally, there may also be an exchange of principal at the start of the deal. Delta The rate of change of fair value of an option with respect to the change in price of the underlying . One of the Greeks . Dividends Regular payments made by companies to their stock holders, which can vary over time. These payments compensate the investors for not receiving interest which they might have received with other investments.
Investors can also make a profit if the stock price increases over time.
Future dividends can have an impact on the worth of an option as the equity or underlying price normally drops when a dividend payment is made. Equity or Stock Non-debt capital employed by companies to finance their operations. Investors earn returns in the form of dividends which can vary over time. OTC options, are constructed to meet a clients needs, so prices for these can only be obtained by approaching a financial institution. An option which may only be exercised at expiration.