So, this is from one of William Goetzmann's books. Not the one I assigned for you. It was one that he wrote with Geert Rouwenhorst. But it was a collection of essays and these two Dutchmen, Gelderblom and Jonker, three of the four are Dutch. You can tell these Dutch names. Writing about the history of options. Well, the first options that are well documented come from Holland. In maybe the 1600s, but this is an example from the year 1730. And unfortunately, it's in Dutch. And if any of you can read that. But this is an example of an option to buy shares. And I can't pronounce this, right. This is like the general royal India company which is a Dutch company in 1730. And so, this is the options contract. Now the other thing that's kind of neat, the Dutch were the most advanced financially people in the world in the 1600s, and maybe into the 1700s. This is a printed form. You see, it's nicely done. This is printed, and someone has filled in the blanks in handwriting to make it an option contract. That wasn't important, I think this might be the beginning of the information age. Printed forms was a way, sort of putting in a program, right? A standard program. Some people call it boilerplate referring to the plates that they made the printing from. So I said, I the undersigned. Later, the options became much more common and they were in newspapers. This is a clipping that I took 20-years ago or so, from probably the Wall Street Journal which used to carry options prices in the printed edition. So, that's all. I took this off of the web yesterday. The CBOE, Chicago Board Options Exchange, has a website. I just picked the company at random. This is Intel Corporation as a manufacturer of computer chips. And the price of the share last quote, I guess that's closing price probably for last Friday, was $31.63 per share. Notice it's about $30. That's because companies do splits whenever it gets much farther than that because this is very American. This looks right for the price of a share. And they'll keep splitting it if it keeps going up. So, it stays around there. And it's been paying a dividend per share of 26-cents quarterly. That's the underlying stock. Now, like in the newspaper column, it shows the exercise prices. Now, I think they're trying to be confusing here. INTC for Intel Corporation, is the ticker for Intel. What is the ticker? It's an abbreviation for the company name which is used in financial reporting. It's a four-letter ticker which is a clue that it's Nasdaq-listed, rather than New York Stock Exchange which normally lists stocks at three letters. Well, here is the strike prices. $27 a share, $30 a share, $32 a share, and $35 a share. And now, the price per share is 31. This is a right to buy it for more than it's selling for today. So, it's out of the money. So, I wouldn't want. Why would anyone want this option, if it's a right to buy the share for more than it costs to buy it? Well, I'll tell you why someone would buy this option. Because it might go up. The price might go up. And you say, well, if you think it might go up, why don't you just buy the share? Well, but if I buy the share, I'm incurring a risk that it might go down. I could lose. I have to pay $31 to get a share. I could lose the whole thing if there was some really bad news. But here, when I buy the option, I'm only paying $2.36. So, I'm not risking as much. So, I'll do. I mean, this looks like a reasonable price. Well, probably is a reasonable price because it's the market price for the option. So, you'd be willing to pay $2.36 for the thought that if the price of the share goes up above $35. That's not too far from where it is now. Then, I'll be able to buy it for only $35. So, that's worth something. This one is in the money. Because I could buy it today for $7. Well, if we forget the price of buying, I can buy today and exercise it at $27. And then it would be immediately worth $31. That's a difference of four $4.63. So, would it be smart to buy this option today, and exercise it immediately? No, because you'd lose money. Because you paid more for the option that you'd make as profit. You'd make the difference between $27 and $31.63 which is $4.63. But I just paid $7 for that, right. So, I wouldn't exercise it immediately. Generally, you don't want to exercise options early because they have option value. The option value is the value that you get the upside without so much downside. So, you generally want to wait to exercise an option. That means, demand that you buy the stock in the case of a call at the exercise price. Now, we also have two other prices, bid and ask. That's because this is an actual last price that a trade was made. But things have changed since then. I was doing this on a Sunday, by the way. There are dealers, market makers, who are quoting prices that you can buy and sell at. So, the bid price is what they are. If you want to sell your option back, you can buy if the dealer is offering $6.05 for the $27 strike price option. Or but if you want to buy the option that the market maker is offering $6.20, that is the difference. That's called the bid ask spread so that the dealer is asking 15-cents more per option than the dealer is willing to pay. That's how the dealer makes money. This strike price 35 seems to be the most active. So, it has the most narrow bid ask spread. It's the most competitive market.