Buy To Open Sell To Close -

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.

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 buy to open sell to close

It typically increases open interest , as a new contract is often being created between you and a seller. Strategic Intent: You pay a premium (debit) to a seller

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