Options FAQ

Options are contracts that give you the right to buy or sell a stock at a set price by a certain date. They work differently from owning shares outright—you're betting on whether a stock price will move up or down, and you can make or lose money based on timing and price changes. People use options to hedge against losses, generate income, or speculate on price movements with less money upfront than buying stock directly.

These articles answer the questions that come up when you're learning how options actually work: What's the difference between a call and a put? How do you know what price and date to choose? What happens if the stock price moves against you? How much can you lose? What does it mean when someone talks about being "in the money" or "out of the money"? You'll find straightforward explanations of the mechanics, the risks, and the language traders use.