Options and warrants are securities by which the seller of securities undertakes to trade a certain amount of the asset at a certain price upon the request of the buyer. The buyer of bonds can perform the transaction at a certain time in the future according to the contract. The seller of the options bond receives a certain amount from the buyer of the bond for this obligation. In order to prevent the bond seller from refusing to perform the contract, he undertakes to consider a fund as a guarantee with the stock broker or a clearing house and adjust it according to the changes in the price of the bond.
Each buyer and seller can transfer their authority or obligation to a third party in exchange for a certain amount, so the third party is replaced by them. Trading options bonds can be in the form of selling or buying options. These bonds can be traded in stock exchanges or over-the-counter markets.

Initial Transactions

The initial trade of option is a type of purchase obligation. In other words, the buyer of the option buys the obligation of another person to perform the legal act of buying or selling by paying an amount. Therefore, the option contract is an independent one.

Secondary Transactions

The secondary trade of option is buying and selling rights.

Asset Base

The underlying asset of an option can be a basket of stocks.

The Method of Settlement in Option

In option contracts, when a group of option holders intend to exercise the option, the clearing houses of the world's financial markets choose the other party to fulfill the obligation of the contract in one of the following four ways;

1- Position tracking method: In this method, the trading history of the applied option contract is scanned and the applied contract is allocated to the issuer of that contract.
2- Random method: In this methods, the applied option contracts are randomly allocated to the resale position holders.

3- Time method: In this methods, the applied option contracts are allocated to the resale position holders based on time priority.
4- Proportional sharing method: In this methods, the applied option contracts are shared among the holders in proportion to the number of resale positions.

Among the four methods the position tracking method is more compatible with the nature if the option contract. Because in this method, each option holder is referred to the person to whom he accepts the responsibility and obligation while other methods have no such a feature. If the implementation of the position tracking method is not possible due to high costs or restrictions, the option sellers shall authorize the clearing house while they are concluding the contract to refer their clients or any option holders for exercising the option to them. In this case, applying any of the above methods in the order of priority is permissible.

Cash Settlement

In warrants and options, in order to avoid fraudulent transactions, it is necessary to make a decision regarding cash settlement or exercise of warrants in the form of physical delivery with the holder of the warrant or the buyer of the option, not the issuer of the warrant or the seller of the option.

Use A Different Strategy

If the combination of contracts is in a way that the buying and selling trading positions are not between two people, in other words, there are option contracts in a wide range of buyers and sellers and people are not required to take the next position after taking the first position, in this case, it is permissible to take a trading position simultaneously in several option contracts.

Asset Base in the Contract

If a company wants to use shares as the basis for issuing a warrant, the details of the shares which are going to be transferred from the place of the warrant shall be transparent at the beginning of issuing the warrant to avoid Gharar.

Other Requirements

The setting up of the regulations and executive instructions shall be in a way to avoid fictitious transactions and economic disruption.