Also called the option writer; the party who grants a right to trade a security at a given price in the future.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
One who originally sells an option contract. In exchange for the premium, the option writer takes on an obligation to buy or sell (depending on the type of option) the underlying asset at the discretion of the option holder. For example, in a call, the option writer must sell the underlying asset to the option holder if the holder decides to exercise the option. If the option writer does not already have a long position in the underlying asset, he/she must obtain one so as to sell the position and fulfill the contract.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved