Exercise of options?

onstudio said:

helo everyone,

i'm new to the aus stock market. today i received a letter from AVB - application form on exercise of option expiring 30 june 2010 for 20cent.

the current price for AVB is 0.014. can someone please explain what is a this about, thanks.

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Kez180 said:

It means that you have the option, but not the requirement to purchase shares in the company, from the company, for 20c a share up until 30/6/2010.

If the options are renouncable you can sell the options, if not then you either use them or let them expire...

so if the share price goes to 0.250 for example, you can exercise the option to purchase at 20c and then sell at 0.250 on market...

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