THE RIGHT TO BUY OR SELL STOCK IN THE STOCK EXCHANGE WITHIN A STIPULATED PERIOD IS

• A. option ✓
• B. contango
• C. backwardation
• D. brokerage

The answer to the question is: A. option

An option is a financial derivative that represents a contract sold by one party (the option writer) to another party (the option holder). The contract offers the buyer the right, but not the obligation, to buy or sell a security or other financial asset at an agreed-upon price (the strike price) within a specified period of time. There are two types of options: call options, which give the holder the right to buy the underlying asset, and put options, which give the holder the right to sell the underlying asset. Options are commonly traded on organized exchanges such as the Chicago Board Options Exchange (CBOE) and can be used for various purposes, including speculation, hedging, and generating income.