Community Stock Questions

Equity options are financial instruments that give the holder the right, but not the obligation, to buy or sell shares of a specific stock at a predetermined price and date. These options are commonly used by investors and traders to manage risk, hedge against potential losses, and speculate on future price movements in the underlying stock.

There are two types of equity options: call options and put options. A call option gives the holder the right to buy shares at a predetermined price, while a put option gives the holder the right to sell shares at a predetermined price. Both types of options have expiration dates, which limit the amount of time the holder has to exercise their right to buy or sell the underlying stock.