what are options ?

 

what are options?

A financial contract known as an option provides you the right, but not the responsibility, to purchase or sell an asset—typically a stock—at a specific cost within a certain period of time

There are two main types:

1. Call Option – gives you the right to buy an asset at a set price.
2. Put Option – gives you the right to sell an asset at a set price.

What is options trading?

Options trading is when investors buy and sell options contracts to potentially profit from changes in the price of the underlying asset, without actually owning the asset.

For example:

• If you think a stock or options will go up, you might buy a call option.
• If you think it will go down, you might buy a put option.