Are the numbers of (options) contracts for a certain stock finite?
Rodger (note: not his real name) (It seems the days of three-page-long e-mails are long gone. This M television thing has corrupted you young folks ability to communicate rationally and to elaborate on a thought without getting sidetracked. Sad. You ve probably lost your sense of irony too. Hmph. Nostalgia just isn t what it used to be). Actually Rodger, no, the numbers of contracts are not finite. While early man looked up to the heavens to bring forth the philosophically unfathomable concept of infinity, most theoretical physicists from the latter 19th century on have focussed on non-linear derivatives to hone their acuities and elaborate formulae that dance around this quite uniquely confusing issue. An option (or any derivative contract) comes into being when two (or more, but we won t go there) entities, which are called counterparties ( cause that s where the hors-d oeuvres are), agree upon terms and create it. Stocks, bonds and most other financial instruments on the other hand
