Options

Options are contracts that provide the right to buy (call options) or sell (put options) an underlying asset at a predetermined price (strike price) before expiration. Options buyers pay a premium for this right, while sellers (writers) collect the premium but take on obligations. Options are used for speculation, hedging, and income generation. Key concepts include intrinsic value, time value, and the Greeks (delta, gamma, theta, vega) which measure various risks. Options strategies range from simple calls and puts to complex multi-leg spreads. Understanding options requires knowledge of pricing models, volatility, and strategic applications.