1.0Traders-Paradisehttps://traders-paradise.com/magazineEditorhttps://traders-paradise.com/magazine/author/gorica/rich600338<blockquote class="wp-embedded-content" data-secret="5J8WKmLIuB"><a href="https://traders-paradise.com/magazine/2019/03/trading-options/">Trading Options – Understand the World of Options</a></blockquote><iframe sandbox="allow-scripts" security="restricted" src="https://traders-paradise.com/magazine/2019/03/trading-options/embed/#?secret=5J8WKmLIuB" width="600" height="338" title="“Trading Options – Understand the World of Options” — Traders-Paradise" data-secret="5J8WKmLIuB" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"></iframe><script> /*! This file is auto-generated */ !function(d,l){"use strict";l.querySelector&&d.addEventListener&&"undefined"!=typeof URL&&(d.wp=d.wp||{},d.wp.receiveEmbedMessage||(d.wp.receiveEmbedMessage=function(e){var t=e.data;if((t||t.secret||t.message||t.value)&&!/[^a-zA-Z0-9]/.test(t.secret)){for(var s,r,n,a=l.querySelectorAll('iframe[data-secret="'+t.secret+'"]'),o=l.querySelectorAll('blockquote[data-secret="'+t.secret+'"]'),c=new RegExp("^https?:$","i"),i=0;i<o.length;i++)o[i].style.display="none";for(i=0;i<a.length;i++)s=a[i],e.source===s.contentWindow&&(s.removeAttribute("style"),"height"===t.message?(1e3<(r=parseInt(t.value,10))?r=1e3:~~r<200&&(r=200),s.height=r):"link"===t.message&&(r=new URL(s.getAttribute("src")),n=new URL(t.value),c.test(n.protocol))&&n.host===r.host&&l.activeElement===s&&(d.top.location.href=t.value))}},d.addEventListener("message",d.wp.receiveEmbedMessage,!1),l.addEventListener("DOMContentLoaded",function(){for(var e,t,s=l.querySelectorAll("iframe.wp-embedded-content"),r=0;r<s.length;r++)(t=(e=s[r]).getAttribute("data-secret"))||(t=Math.random().toString(36).substring(2,12),e.src+="#?secret="+t,e.setAttribute("data-secret",t)),e.contentWindow.postMessage({message:"ready",secret:t},"*")},!1)))}(window,document); </script> https://traders-paradise.com/magazine/wp-content/uploads/2019/03/options-trading.jpg536488An option is a contract which gives you the right, but not the obligation, to buy (which is a call) or sell (which is a put) shares of the underlying security at a specific price (which is the strike price) on or before a negotiated date (which is expiration day). After this assigned date, the option stops to exist. The seller of some option is, on the other hand, obligated to sell (if it is a call option) or buy (if it is a put option) the shares to the buyer at the defined price in the buyer’s demand. Option contracts regularly are 100 shares of the underlying stock.