Options Definitions & Glossary

Build the foundation you need to trade confidently. Explore clear explanations of essential options concepts and a comprehensive glossary that demystifies key terms and market language.

A financial derivative is a contract with a value that is tethered to, or derived from, another asset. Options and futures are examples of financial derivatives.

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Options Definitions & Glossary

Options Definitions & Glossary

What is a derivative?

What is an option contract?

What is a call?

What is a put?

What is an underlying asset?

What's the difference between American-style and European-style options?

What's the difference between physical settlement and cash settlement?

What is notional value versus premium?

What are 0DTE options?

What is margin in options trading?

What is liquidity and what factors affect options liquidity?

What should I understand before trading options?

How do I learn more about options?