Vanilla options

These are the basic European and American calls and puts.

European call

If you buy this option then you have the right but not obligation, to buy an asset at expiry for the strike price. If you sell such an option, then the buyer has those rights.

European put

If you buy this option then you have the right but not obligation, to sell an asset at expiry for the strike price. If you sell such an option, then the buyer has those rights.

American call

If you buy this option then you have the right but not obligation, to buy an asset up to expiry for the strike price. If you sell such an option, then the buyer has those rights.

American put

If you buy this option then you have the right but not obligation, to sell an asset up to expiry for the strike price. If you sell such an option, then the buyer has those rights.

Option strategies

Various option strategies

can be constructed using combinations of options and stock. The most common are