A call option is an agreement between a buyer and seller at time 0, when there is a contractual agreement that an asset will be exchanged for cash at some later date.

Question

Quizplus · Accepted Answer

A call option gives the holder the right, but not the obligation, to buy an asset at a specified price within a specific time period, but it does not involve a contractual agreement to exchange the asset for cash at a later date.

A Call Option Is an Agreement Between a Buyer and Seller