An option is a contract between a buyer and a seller. The option is connected to something, such as a listed stock, an exchange index, futures contracts, or real estate. For simplicity, this article will discuss only options connected to listed stocks. Just to be complete, note that there are two basic types of options, the American and European.
All stock options are American style.
The two most popular types of options are Calls and Puts. We'll cover calls first. An option is worthless and useless after it expires. People also sell options without having owned them before. The strike price is 90.