GTE1250117P00002000 Option on Gran Tierra Energy

An 'Out of The Money' option on Gran has a strike price that Gran Stock has yet to reach, meaning the option has no intrinsic value. 'Out of The Money' options are usually less costly than 'In The Money' options, making them more desirable to traders with smaller amounts of capital. Some of the uses for Gran Tierra's 'Out of The Money' options include buying the options if you expect a big move in Gran Tierra's stock. Since 'Out of The Money' options have a lower up-front cost (i.e., no intrinsic value) than 'In The Money' options, buying it is a reasonable choice.

Gran Tierra's Option Greeks for the contract ending on 2025-01-17 at a strike price of 2.0 measures the various factors that affect its cost and calculated using a theoretical options pricing model. It helps investors make more informed decisions about whether to trade this option contract or when to trade it. In addition to Gran Tierra's option greeks, its implied volatility helps estimate the risk of Gran Tierra stock implied by the prices of the options on Gran Tierra's stock.

Put options written on Gran Tierra grant holders of the option the right to sell a specified amount of Gran Tierra at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Gran Stock cannot fall below zero, the put buyer does gain as the price drops. So, purchasing a put option on Gran Tierra is like buying insurance aginst Gran Tierra's downside shift.

By selling Gran Tierra's put option, the investors signal their bearish sentiment. A short position in a put option written on Gran Tierra will generally make money when the underlying price is above the strike price. Therefore Gran Tierra's put payoff at expiration depends on where the Gran Stock price is relative to the put option strike price. The breakeven price of 0.55 is the critical point that divides the payoff function into two parts. Below the breakeven price, the payoff is dropping and negative (the seller makes a loss). Above the breakeven price, the payoff line is upward sloping as the option payoff increases in proportion to Gran Tierra's price. Finally, at the strike price of 2.0, the payoff chart is constant and positive.

Gran Tierra's option chain is a display of a range of information that helps investors for ways to trade options on Gran. In general, an option chain provides a helpful tool for investors to see all available option contracts, both puts, and calls, for Gran. It also shows strike prices and maturity days for a Gran Tierra against a given expiration period. The table below combines all the option information in the form of a chain but before you use it, remember that it entails significant risk and it is not for everyone.

Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Gran Tierra Energy. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in estimate. You can also try the Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.

Is Oil & Gas Exploration & Production space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Gran Tierra. If investors know Gran will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Gran Tierra listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.

The market value of Gran Tierra Energy is measured differently than its book value, which is the value of Gran that is recorded on the company's balance sheet. Investors also form their own opinion of Gran Tierra's value that differs from its market value or its book value, called intrinsic value, which is Gran Tierra's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Gran Tierra's market value can be influenced by many factors that don't directly affect Gran Tierra's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.

Please note, there is a significant difference between Gran Tierra's value and its price as these two are different measures arrived at by different means. Investors typically determine if Gran Tierra is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Gran Tierra's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.