Contract Specifications
Options are derivative contracts that give the buyer the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specific time frame.
Call Option
Right to buy the underlying asset at strike price
Put Option
Right to sell the underlying asset at strike price
Long Position
The buyer pays premium to acquire option rights
Short Position
The seller (writer) receives premium but must fulfill obligations
if exercised
Long Call
Buy call option - Bullish strategy
Long Put
Buy put option - Bearish strategy
Short Call
Sell call option - Neutral/bearish strategy
Short Put
Sell put option - Neutral/bullish strategy
Underlying Asset
The financial instrument the option is based on
Strike Price
The predetermined price at which the option can be exercised
/ Premium
The price paid or received for the option contract
Expiration Date
The date when the option contract expires
American Style
Can be exercised at any time before expiration
European Style
Can only be exercised on the expiration date
Contract Size
Standard size: 100 shares for equity options
Price Boundaries
Theoretical minimum and maximum values for European options.
Call Option: Max value is (Stock Price);
Min value is 0
Put Option: Max value is (Strike);
Min value is 0