There is a trader, who trades option. His goal is to be a multi-billionaire.
When he first stepped in the commercial world, he was attracted. He could go for Forex market, he could go for bond market, he could go for stock market, he could go for derivatives market, he could go for real estate market, and he could go for commodity market.
He saw the potential in derivatives market, and he decided to go for it.
Not long after he entered into the field, he purchased a call option. The strike price was low, but the underlying asset is a fast-growth asset. Not volatile.
One day, he suddenly became so confident. He felt that the stock was going up for sure. So, to make more money, he sold the call option, and got a forward contract instead, since forward contract is free.
He does not buy the stock immediately, because he has no cash.
He is now waiting for maturity date. He is afraid that the management is not doing their job well. He now joins the company, to make sure that the forward happens to be in-the-money.
O yea, the option was not a European one, but a Bermuda option.
Some said he was too crazy to sell the option. Some said, under such circumstances, his decision was right. Some said, well, it depends on the management.
This trader is in the management now. And suddenly he realizes: O, it is not just all about management! The market makers and speculators are also influencing the stock price!
So, this trader goes to be a speculator now.
That's why, he has three jobs. And he is still happy for his condition.
