What are the types of options?

(1) Classified by option rights, there are two types: call options and put options:

1. Call Options: After the buyer of an option pays a certain amount of premium to the seller, they have the right, but not the obligation, to buy a certain quantity of the specific commodity specified in the option contract from the option seller at a pre-agreed price during the validity period of the option contract. The option seller has the obligation to sell the specific commodity specified in the option contract at the pre-agreed price upon the request of the option buyer during the validity period of the option contract.

2. Put Options: After the buyer of an option pays a certain amount of premium to the seller, they have the right, but not the obligation, to sell a certain quantity of the specific commodity specified in the option contract to the option seller at a pre-agreed price during the validity period of the option contract. The option seller has the obligation to buy the specific commodity specified in the option contract at the pre-agreed price upon the request of the option buyer during the validity period specified in the option.

(2) Classified by option delivery time, there are two types: American options and European options:

1. American Options: Options that can be exercised at any time during the validity period specified in the option contract.

2. European Options: Options that can only be exercised on the expiration date specified in the option contract. The buyer of the option cannot exercise the right before the expiration date of the contract, and the contract automatically becomes void after the expiration date.

3. Most stock options are American options, while index options are generally European options.

(3) Classified by the underlying asset in the option contract, there are stock options, stock index options, interest rate options, commodity options, and foreign exchange options.