Options define the criteria for the buying and selling of securities. They are contracts between two parties that give the buyer the right, but not the obligation (hence the name option), to buy or sell an underlying asset or security at a specific price anytime within a specified time period (until the contract date on the particular option expires). Similar to a stock or bond, an option is a security. Option contracts set conditions, such as price and time frame, for the buying or selling of a specific security. Options are also two-party, binding contracts with strictly defined terms and properties.
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