Buying Options
There are two types of standardized options, calls and puts. Options trade in contracts. One Contract equals 100 shares of the underlying stock.
Buying a call is an equivalent strategy to going long (buying) the stock. The trader's goal is to benefit from a rising stock price.
Buying a call gives the holder the right to buy 100 shares of a security at a set strike price.
Buying a put is an equivalent strategy to shorting (selling) a stock. The trader's goal is to benefit from a falling stock price.
Buying a put gives the holder the right to sell 100 shares of a security at a set strike price.
There are many other ways to trade options. TradeWithPros strictly utilizes the buying of options as a trade strategy.
(for more information on the terms long and short please see Stocks)