Options are contracts that give the holder the right, but not the obligation, to buy or sell an asset at an agreed price on or before a specified date. They are a financial instrument that represents a contract sold by one party, called the option writer to another party (the option holder). The contract offers the buyer the right, but not the obligation, to buy or sell a security or other financial asset at an agreed-upon price which is referred to as the strike price during a certain period of time or on a specific date called the exercise date. Call options give the option to buy at certain price, so the buyer would want the stock to go up in order to make a profit. Put options give the option to sell at a certain price, so the buyer would want the stock to go down.