To Close: Buy To Open Sell

You expect the underlying asset's price to fall (bearish). 2. Sell to Close (STC): Exiting the Trade

It can decrease or leave open interest unchanged, depending on whether the buyer is also opening or closing a position. buy to open sell to close

This order is used to a new long position. When you execute a BTO order: You expect the underlying asset's price to fall (bearish)

In options trading, "Buy to Open" (BTO) and "Sell to Close" (STC) are the two halves of a standard . They describe the lifecycle of a trade where you purchase a contract first and exit it later by selling it. 1. Buy to Open (BTO): Entering the Trade This order is used to a new long position

Most traders use STC to capture the option's remaining extrinsic value (time value and volatility) rather than exercising, which only captures intrinsic value. Comparison Summary Master the Basics: 4 Key Options Trading Strategies

This order is used to a position you previously opened via BTO. When you execute an STC order: Action: You sell your existing contract to another party.

You pay a premium (debit) to a seller to acquire the rights of a contract. Result: You become the "holder" or "buyer" of the option.