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Calls

A Call Option gives the buyer a option to buy a stock at a specific price on or before a certain date. 

Call options usually increase in value as the value of the underlying stock  increases or decreases.

When you buy a Call option, the price you pay for it, called the option premium, secures your right to buy that certain stock at a specified price, which is the strike price.

If you decide not to use the option to buy the stock, and you are not obligated to, your only cost is the option premium.

A call option is best bought when you beleive the underlying asset will increase in value by a certain time frame.

For more infomation see the Resources page.

Puts

Put Options are options to sell a stock at a specific price on or before a certain date. In this way, Put options are like insurance policies

 In this way, the put option gains in value as the value of the underlying asset decreases. 

If you decide not to use the option, then the only cost accrued is the premium.

A put option is best when you think the underlying asset will go down.

See Resources.