You're here:  Home --> Dictionary --> O --> Option

At the Money
In the Money
Out of the Money
Strike Price

Option
Term category: Derivatives, Advanced
In 10 words or less: A security that grants the holder the right to buy or sell a stock at a given price.

Definition: An option is the right for a person to buy or sell a stock at an agreed upon price by a given date.

StockJargon Advice: People use options for various reasons. Some use them to speculate, and some use them to hedge their positions.

Call options are options that allow the person to bet on the stock going up. Put options allow the investor to bet on the stock going down.

Related Articles

Options and Put-Call Parity
This article will help to explain what options are and how people use them for hedging/speculating...

Commodity Trading
Commodity trading can be quite risky but it is an alternative to stocks and bonds.

Foreign Exchange Markets
Investing in the foreign exchange market has its own benefits and disadvantages, as this article discusses.

Related Books

Stock Options for Dummies by Alan R. Simon
Professional Stock Trading by Mark Conway
My Life as a Quant by Emanuel Derman
Come Into My Trading Room By Alexander Elder

# -A - B - C - D - E - F - G - H - I - J - K - L - M - N - O - P - Q - R - S - T - U - V - W - X - Y - Z