OptionsAn option is a contract that gives the buyer the right, but not the compulsion, to buy or sell an underlying asset at a specific price on or before a certain date. Underlying assets are like equity (share/stock), indices (nifty, Jr. Nifty), commodity etc.
Calls and Puts
The two types of options are calls and puts:
A call gives the holder the right to buy an asset at a certain price within a specific period of time. Calls are similar to having a long position on a stock. Buyers of calls hope that the stock will increase before the option expires.
A put gives the holder the right to sell an asset at a certain price within a specific period of time. Puts are very similar to having a short position on a stock. Buyers of puts hope that the price of the stock will fall before the option expires.
Note - Currently we are in the process of writing more about options and how to trade on them and very soon we will post them on website. For more information please visit our Options section.
Calls and Puts
The two types of options are calls and puts:
A call gives the holder the right to buy an asset at a certain price within a specific period of time. Calls are similar to having a long position on a stock. Buyers of calls hope that the stock will increase before the option expires.
A put gives the holder the right to sell an asset at a certain price within a specific period of time. Puts are very similar to having a short position on a stock. Buyers of puts hope that the price of the stock will fall before the option expires.
Note - Currently we are in the process of writing more about options and how to trade on them and very soon we will post them on website. For more information please visit our Options section.
