If you leaf through the business section of major broadsheets, you will mostly likely notice that some company executives are given what are called options as part of their annual salaries or as bonuses for jobs done well.

But what are options, really? Are they similar to stocks? What does it mean when they say options are exercised? These are some of the options questions whose answers we will learn in this article.

Options are similar to stocks in a way that they also can be traded in the stock market.

When we talk about financial markets, the first thing that comes into our minds is the word ‘stocks’. The term has been used so many times in the papers and financial fora that it has become a staple in a lot of conversations and discussions about the subject of market movement. However, there is another financial investment instrument that also offers great rewards for those who choose it. And it is in the form of options.