What is option

Question

What is option

Accepted Answer

An option is a contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specific price on or before a certain date.

Options are commonly used in the stock market as a form of derivative trading.
There are two types of options: call options and put options.
Call options give the buyer the right to buy an underlying asset at a specific price, while put options give the buyer the right to sell an underlying asset at a specific price.
Options can be used for hedging or speculation purposes.
The price of an option is determined by various factors, including the price of the underlying asset, the strike price, the time until expiration, and the volatility of the underlying asset.

Accepted Answer

Options are a type of derivative product that allow investors to speculate on or hedge against the volatility of an underlying stock. Options are divided into call options, which allow buyers to profit if the price of the stock increases, and put options, in which the buyer profits if the price of the stock declines.

What is option

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