GlossaryAdvanced
Call Option
An option contract granting the right to buy an asset at a set price.
A call option grants its buyer the right, but not the obligation, to purchase an underlying asset at a predetermined price (the strike price) before or at expiry — generally purchased by someone expecting the asset's price to rise.
The option's value generally increases as the underlying asset's price rises above the strike price.
Examples
- A call option becomes more valuable as the underlying asset's price rises above its strike price.
- Buying a call option is a common way to express a bullish view with limited downside risk.