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The conrtra party to an option is the clearing the corporation. If you close
out your position the contra party to your close is the clearing corp initially
and then another option user. Your original position could have bought and
resold dozens of times or may still exist... there is no way to tell. One
caution, this is why OPEN INTEREST numbers can be some deceiving.
De Vries, Trevor wrote:
> R'Ters
>
> If you sell a call/put option, and it starts moving against you, you then
> have the option to buy it back (loss) before you get excercised.
> What then happens to the entitiy on the other side of that deal, ie. the guy
> who bought the call/put. Is is position cancelled out as well, or can he
> hold on as long as he likes.
> If he can hold on, who then is the entity that pays him out.?
>
> Regards
>
> Trevor De Vries
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