What are US stock options and what does "long options trading" mean?

A US stock option is a contract that gives the buyer (the "long" position holder) the right, but not the obligation, to buy or sell a specified number of shares of an underlying US stock at a predetermined price (the "strike price") on or before a certain date (the "expiration date").

"Long options trading" means you are only permitted to buy options. You are not allowed to sell or "write" options. This is a key difference that significantly impacts your risk profile. As a buyer, your risk is limited to the premium you pay for the option contract. You are not obligated to buy or sell the underlying stock.

• Buying a Call Option (Long Call): This gives you the right to buy the underlying stock at the strike price. You would buy a call option if you are bullish and believe the stock's price will rise significantly. Your potential profit is theoretically unlimited, and your maximum loss is the premium paid.

• Buying a Put Option (Long Put): This gives you the right to sell the underlying stock at the strike price. You would buy a put option if you are bearish and believe the stock's price will fall. The maximum profit is limited by the stock's price falling to zero, and your maximum loss is the premium paid.買入看跌期權。您的最大利潤受限於股價跌至零，而您的最大損失是支付的權利金。