Option Trading

What Is an Option?

An option is a contract between two parties: the buyer and the seller (writer).
It gives the buyer the right—but not the obligation—to buy or sell an underlying asset at a predetermined price (called the strike price) before or on a specific date (called the expiry date).

There are two main types of options:

Call Option – gives the buyer the right to buy the asset.

Put Option – gives the buyer the right to sell the asset.