Options trading is a form of investment that allows traders to buy and sell the rights to purchase or sell a specific financial instrument at a predetermined price, within a set time frame. Unlike stock trading, where traders buy and sell shares, options traders deal in contracts that offer the flexibility to speculate on the future price movements of assets without actually owning them. There are two main types of options: call options, which give the holder the right to buy an asset at a specific price, and put options, which allow the holder to sell an asset at a predetermined price. Options trading can be used for hedging against market risks, income generation, or speculative purposes. It requires a good understanding of market trends, risk management, and the specific mechanisms of options contracts. This form of trading is popular among investors looking for strategies with potentially high returns and controlled risks.