The chicago board of options exchange cboe is the largest such exchange in the world offering options on a wide variety of single stocks etfs and indexes 1 traders can construct option. A good options trade can bank 100 in profit from a 10 gain in stock price but it can be tricky getting started so we wanted to share our guide with you options trading for beginners how to. One option is called a contract and each contract represents 100 shares of the stock for example if you buy or sell three contracts your options position tracks the movement of 300 shares of stock options allow investors to capture a stocks movement while paying a much smaller upfront cost the premium. An option is a contract that gives the owner the right to buy or sell a stock at a set price on or before a set date in other words it is a piece of paper that allows you if you own the contract to buy or sell a stock at a set price before the contract expires there are two basic types of options calls and puts