 In selling options, the person who writes or sells a call on an underlying asset must deliver the underlying asset at the date of expiring, as that person is obligated to do so under this particular contract. So for a selling a call is concerned, the investor selling a call must deliver the underlying asset if he is requested or he is required to do so by the call holder. Now at the expiration date, if the stock price or the market price of the underlying asset is greater than the exercise price, the option seller will buy at the higher price and will lose certain amount of money, but if the market price of the underlying asset is less than the exercise price, then the call option will not be exercised and the seller's liability will be equal to zero as he is not obligated to deliver the asset at that particular date. Then why such position is there for the seller? The first reason is that he is paid to take this type of risk. Then second reason is that on the date of transaction, he receives a certain amount of cash from the buyer. What is selling output? Investor selling output agrees to deliver, agrees to buy an underlying asset at the date of expiring if the put holder request him to buy the underlying asset. Now if the market price of that underlying asset is less than the exercise price, the seller will lose certain amount of cash. For example, assume that the market price of an underlying asset under output contract is $50 whereas the exercise price is $40. The put holder will exercise because he will sell the underlying asset at the exercise price whereas the seller of the put then must buy the underlying asset at the access price of $40. This means that asset is worth at $40 only and there is a $10 loss in this transaction. On the screen we see certain diagrams that depict the value of selling a call and selling a put position. We see that a graph A on the left side this graph shows that the seller of the call loses nothing because the stock price at the expiration date is less than $50. So in this contract he loses equivalent amount of money if the stock price rises over $50. This means that his loss will be equivalent to the rise in the stock price over the $50 whereas the graph B is concerned we see that the seller of a put loses nothing when the stock price at the expiration date is above $50. He will lose only when the stock price will fall below $50. So the difference between graph 1 and graph B is that under graph A the holder will lose if the price falls below $50 whereas in graph B the holder of the put contract will lose if the price rises above $50. The loss of both the holders under both the contract will be equal to the similar amount of rise or fall. Now we see that buying the stock is as same as buying a call option on the stock with the zero exercise price and it is not surprisingly at a zero exercise price because the holder of the call can buy this stock for nothing like the same as owing it.