Options trading is the buying or selling of contracts that related to shares of stock. Each options contract controls 100 shares of the underlying security or stock. The option contract is comprised of a strike price, an expiration date, and the type of contract (call or put). In this video I cover some of the basics of options trading and how they relate to call and put options contracts. An option contract is "in the money" when the price of the stock has breached the strike price of the contract. For an example a 130 call contract would be in the money if the price of the stock had risen above $130. For a 130 put contract to be in the money then the price of the underlying stock would need to be below $130. So if the stock was trading at $125, then a 130 call option would be out of the money. If the stock was trading at $135, then a 130 put option contract would be out of the money.

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