In the case of open-end mutual funds, the offering price is the price per share of the fund that you pay when you buy. If it's a no-load fund, a back-end or Class B fund, or a level-load or Class C fund, the offering price and the net asset value (NAV) are the same. If it's a front-load or Class A fund, the sales charge is added to the NAV to arrive at the offering price.

Some online firms are divisions of traditional brokerage firms, while others operate exclusively in cyberspace. Most of them charge much smaller commissions than conventional firms, and most provide extensive investment information, including regularly updated market news, on their websites.

While online trading may become the norm in the future, especially as after-hours trading and electronic communications networks (ECNs) gain popularity, there are a number of issues to be resolved. These include, for example, the responsibility of online brokerage firms to monitor trades by inexperienced or over-zealous investors to prevent major losses resulting from inappropriate buy and sell decisions, and the need to keep and provide accurate records of all trades.

The term open market is also used to describe an environment in which interest rates move up and down in response to supply and demand in contrast to those rates that are set by the Federal Reserve Board. The Fed's Open Market Committee assesses the state of the US economy on a regular schedule and instructs the Federal Reserve Bank of New York to buy or sell Treasury securities on the open market to help control the money supply.

However, an open-end fund may be closed to new investors at the discretion of the management, usually because the fund has grown very large. Large funds may have difficulty investing their assets nimbly enough.

If you buy an option to buy, which is known as a call, you pay a one-time premium that's a fraction of the cost of the actual transaction. For example, you might buy a call option giving you the right to buy 100 shares of a particular stock at a strike price of $80 a share when that stock is trading at $75 a share. If the price goes higher than the strike price, you can exercise the option and buy the stock, or trade the option to someone else at a profit.

If the stock price doesn't go higher than the strike price, you don't exercise the option, and it expires. Your only cost is the money that you paid for the premium. Similarly, you buy a put option, which gives you the right to sell the underlying investment to the person who sold the option. In this case, you exercise the option if the market price drops below the strike price.

In contrast, if you sell a put or call option, you collect a premium and must be prepared to buy or sell the underlying investment if the investor who bought the option decides to exercise it. You can buy or sell individual stock options, stock index options, and options on futures contracts, currency, and Treasury securities interest rates.

An option premium is not a fixed amount, and typically increases as the demand for the option increases and decreases as demand shrinks. However, factors such as the price and volatility of the underlying investment, current interest rates, and the amount of time left before the option expires also affect the premium price.

You can get a sense of the current range of premium prices by looking at the Options Quotations tables in the financial pages of your newspaper. The figures you see there, expressed in numbers and fractions, represent the per-share price. You multiply by 100 to find the option premium. So, for example, 10 means a premium of $1,000 and 1/2 (or 0.5) means a $50 premium.

The OCC is also a valuable source for investor information. For an overview of what you should know about options trading, check their publication Characteristics and Risks of Standardized Options.

The appeal, from an investor's perspective, is being able to invest less up front while anticipating full repayment later on. Issuers like these securities as well because they don't have to pay periodic interest. Instead, the interest accrues during the term of the bond so that the total interest when combined with the principal equals the full par value at maturity. Zero-coupon bonds are a popular type of original issue discount security.

Approximately 3,600 companies, which must reported their financial information to the Securities and Exchange Commission (SEC) or appropriate regulatory agency to have their securities qualify for inclusion, are tracked on the OTCBB.

For example, a call option on a stock with a strike price of $50 would be out of the money if the current market price were $45. And a put option on the same stock would be out of the money if its market price were $55. When an option is out of the money, you don't exercise it but let it expire.

The number of outstanding shares is also used to derive all of the financial information that's provided on a per-share basis, such as earnings per share or sales per share.

In actual practice, OTC trading is done through a telephone and computer network. A number of companies that qualify for exchange listing have chosen to continue to trade OTC because they prefer the network of dealers to the centralized system typical of a large exchange. Government and municipal bonds (munis) are also traded OTC.

The consequence of overvaluation is usually a drop in the stock's price-sometimes a rather dramatic one. However, in the current market, the high stock prices commanded by some Internet-based companies seem to defy conventional valuation standards.