Credit Risk in the Options Market Is Only a Concern

question 112

True/False

Credit risk in the options market is only a concern to the option seller.

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Definitions:

Mutual Assent

Mutual assent is a principle in contract law that states an agreement must involve a clear offer and acceptance between parties to be legally binding.

Consideration

In contract law, it refers to something of value exchanged between parties as part of a contract, required for the agreement to be legally binding.

Capacity

The legal ability, competency, or power to enter into a contract.

Legality

The state or quality of being in accordance with the law; adherence to the law.