Option Guides

When trading options on zkVault, it is important to consider several key parameters that determine the characteristics and pricing of the options.

1. Option Type: Options can be either a call option or a put option.

   • Call Option: Gives the holder the right to buy the underlying asset at a predetermined price.

   • Put Option: Gives the holder the right to sell the underlying asset at a predetermined price.

2. Option Position: There are two positions for each type of option.

   • Long Option: Buyers of options who pay a premium upfront and have the potential to profit if the option is in-the-money.

   • Short Option: Sellers of options who receive an upfront premium but may have an obligation to fulfill the option if it is exercised.

3. Underlying Asset: The asset from which the option derives its value.

   • For example, in the case of $zkVAULT, a call option allows the buyer to purchase $DPX at a specified price, while a put option allows the buyer to sell $zkVAULT at a specified price.

4. Strike Price: The predetermined price at which the option can be exercised.

   • For a call option, it is the price at which the underlying asset can be bought.

   • For a put option, it is the price at which the underlying asset can be sold.

5. Expiration: The date and time at which the option contract expires.

   • After the expiration, the option can no longer be exercised.