Options Trading Tutorial

Forex options question?

If I decide to sell a call option of a, let's say eur/usd with a strike price of current currency rate + 100 pips (where 100 pips is a premium), and the currency exchange rate on the exercise day is currency rate + 50 pips does call option buyer has a right to exercise it (thus leaving me with profit of just 50 instead of a 100 pips) or not (it expires worthless)?

Public Comments

1. European options can be exercised at anytime while American options can only be exercised on the expiration date, if your option goes up they pay you for your option plus whatever amount it goes up, if they go down then they won't exercise it because they could buy it cheaper so why pay more for a worthless option.
2. Hello there... It varies from broker to broker..you have to check the options your brokers provide. You can also see the explanation in the site :- http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&item=320335141456