Buying Options For Dummies Review

Buying options gives you the , but not the obligation , to buy or sell a stock at a specific price within a set timeframe. It’s essentially a contract where you pay a fee (the premium ) to "reserve" a price (the strike price ) for a set period (until the expiration date ). The Two Core Types of Options

If the market price goes above your strike price, you can buy the stock at a "discount" or sell the contract for a profit. buying options for dummies

If the market price drops below your strike price, the value of your put increases because you can sell the stock at a price higher than the current market rate. Essential Lingo Options Trading for Beginners (The ULTIMATE In-Depth Guide) Buying options gives you the , but not

They give you the right to 100 shares at the strike price. If the market price drops below your strike

They give you the right to 100 shares at the strike price.

: You buy these when you think a stock price will fall .

: You buy these when you think a stock price will rise .