I was recently on Optional Alpha, which provides an overview of how to trade options, from A to Z.
During one of the videos/lectures, there was an introduction for: buy to open, sell to close, sell to open and buy to close.
The latter was true for option sellers. As I understood from the videos, an option seller can get out of the contract, by buying the same contract, and in some cases profit, if the price of that contract is lower.
However, doesn't the seller's obligation to fulfill the put/call option still remain? What if the strike price will move in a very favorable position? Would they still be able to effectively get out of their "sell to open trade" by taking the opposite e.g buy to close?
The above notion was introduced under the concept of debit and credits.
I believe that I have this concept a bit mixed up. I would be grateful if someone could provide some clarity.