Options in Stock Market
Options in Stock Market In the stock market, an option is a contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price (strike price) on or before a specified date (expiration date). The underlying asset can be a stock, an index, a commodity, or a currency. There are two types of options: call options and put options. A call option gives the buyer the right to buy the underlying asset at the strike price, while a put option gives the buyer the right to sell the underlying asset at the strike price. Options are used for a variety of purposes, including speculation, hedging, and generating income. Options trading can be risky and requires a good understanding of the underlying asset and market conditions. It is important to consult with a financial advisor before trading options. Why options started in Stock Market ? Options were first introduced in the stock market as a way for traders and investors to hedge against mark...