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A call option gives you the right to buy, and a put option gives you the right to sell.
By buying a call option , the investor is again making a bet that the underlying stock will be trading at a price higher than current market prices, so they're locking in the ability to buy at a cheaper rate.
For example, a call option allows you to buy a thousand shares or a hundred shares of stock for a small amount.
The call option allows you to control the same 100 shares for substantially less than it cost to purchase the stock outright.
A call option that gives you the right to acquire 100 shares of Microsoft at $50 for the next three months costs about $550.
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