Option

An option, in finance, is a type of derivative security. It gives the holder of the option the right to purchase (or sell) a security at a predefined time in the future and for a predetermined amount. There are several types of options depending on the type of underlying instrument involved. They include:

• stock options
• foreign exchange options
• interest rate options
• warrants
• options on bonds
• options on futures
• swaption

This article is a stub. You can help Wikipedia by expanding it.