Part 1 Introduction to Candlestick PatternsWhat Are Options?
Options are financial contracts that give you the right, but not the obligation, to buy or sell an underlying asset (like a stock, index, commodity, or currency) at a specific price, called the strike price, before a fixed date known as expiry.
There are two types of options:
1. Call Options – Right to buy
2. Put Options – Right to sell
Options derive their value from the underlying asset; that’s why they are called derivatives.
Unlike stocks, options have a limited lifespan. They expire weekly, monthly, or quarterly depending on the market.
