It's all Greek to me

Financial Education
Jul 02 2015

By Caitlin Graham

If you think of Ancient Greece, you might think of the Disney movie Hercules or you might make jokes about Hades, or you may even think of Zeus with his powerful lightning bolts and Poseidon with his handy-dandy trident. But you most likely won’t think of the realistic aspects of everyday life and the people that lived there, much less the options market.

According to thealertinvestor.com, an option conveys the right to buy or sell an asset for an agreed upon price at a designated time, but the person selling/buying/trading is under no obligation to go through with the actual transaction. Now if you’re like me and you know a good bit about Greek mythology, this might remind you of a certain god. Since most of you probably aren’t like me, I’ll go ahead and explain what I mean by this. Hermes was the Greek god of commerce and trade. He protected thieves, was the messenger of the gods, and could move souls into the afterlife. Now, it might seem strange to you that the god of commerce also protects thieves. This might seem slightly counterintuitive, and at times it might have been, but he was Zeus’ son, and what is Zeus if he isn’t causing problems?  

Now, an option gives you the choice of going through with a trade or abandoning it. This doesn’t mean that the person trading/selling goods would necessarily offer to trade and then back out at the last minute. Hermes, on the other hand, was a trickster. He would outwit the other gods and pull pranks on them basically for his own amusement. So it would suffice to say that Hermes would most likely make a deal with another god using the options market, particularly before a large confrontation. Hermes would offer supplies, his support, etc. for something the other god had or could do for him. Then, in the middle of the confrontation (where the other unsuspecting god thought they had the help of Hermes), he would cancel the trade because he wasn’t obligated to go through with it, mostly for the sake of causing problems.

This is just one of the many aspects of the options market, and just a tiny piece of what the article From Ancient Greece to Wall Street: A Brief History of the Options Market has to offer. If you want to learn more about the options market and how it has changed and adapted through time, check it out. Thealertinvestor.com is sponsored by FINRA and contains tons of useful information if you’re interested in any form of finance or financial education.

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