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buy to close

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Financial Dictionary

Buy To Close

A term used by many brokerages to represent the closing of a short position in option transactions.

Investopedia Commentary

Investor can buy to close either (or a combination of) puts or calls, and thus will be relinquishing obligations associated with the option(s). The distinguishing factor of a buy to close is that the option position must have been held short in the account during the transaction.

Related Links

Options Basics Tutorial

See also: Buy, Buy to Open, Call, Long, Open Interest, Option, Put, Sell to Close, Sell to Open, Short

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