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<p id="isPasted">An option is a contract giving the buyer the right—but not the obligation—to buy (in the case of a call) or sell (in the case of a put) the underlying asset at a specific price on or before a certain date. People use options for income, to speculate, and to hedge risk. They are known as derivatives because they derive their value from an underlying asset.</p><p>A stock option contract typically represents 100 shares of the underlying stock, but options may be written on any sort of underlying asset from bonds to currencies to commodities.</p>
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<p id="isPasted">Options trading is the buying and selling of contracts that give the buyer the right, but not the obligation, to buy or sell an underlying asset (like a stock) at a specific price (the strike price) before a certain date (the expiration date). These contracts are called options, and traders use them to speculate on price movements, hedge their portfolios, or generate income. There are two main types of options: call options give the right to buy, while put options give the right to sell. </p><p><br></p>
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