What are call and put option?

Question

Accepted Answer

Call and put options are financial contracts that give the buyer the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specified time period.

Call option gives the buyer the right to buy an underlying asset at a predetermined price within a specified time period
Put option gives the buyer the right to sell an underlying asset at a predetermined price within a specified time period
The predetermined price is called the strike price
The specified time period is called the expiration date
Options are commonly used in the stock market to hedge against potential losses or to speculate on future price movements