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American Call Option

An American Call Option is a contract that gives the buyer the right to buy 100 shares of an underlying equity at a predetermined price (the strike price) for a specific time period defined by the expiration date. The seller of a Call Option is obligated to sell the underlying security if the Call buyer exercises his or her right to buy on or before the option expiration date. For example, one contract of the XYZ May 21 60 Calls entitles the buyer to purchase 100 shares of XYZ common stock at $60 per share at any time prior to the option's expiration date of May 21.

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