Options arise in many fields.
For example, in real estate, the holder of a property might issue an option to a prospective buyer allowing the buyer to purchase the property any time during the next three months at a specified price. In finance, options are a type of derivative instrument . They are traded on exchanges as well as over the counter . They are linked to a variety of underliers including stocks, baskets of stocks, bonds, currencies, futures , swaps and commodities. A put option gives the holder the right to sell a specified quantity of the underlier at a specified strike price by a specified expiration date.