When you buy a Call Option, you are giving the right but not the obligation to purchase a specific underlying asset at a pre-determined price within a set time frame. If the stock, bond, or commodity increases in value during that time period, your profits will increase as well.There are many benefits of buying call options. For one, they offer investors an opportunity to profit from an increase in the underlying asset's price without having to actually own the asset. Additionally, call options provide protection against market volatility; if prices drop significantly below the strike price of your option contract while it is still active, you can choose to sell your contract at that lower price and still make money on your investment.Finally, because there is no obligation to purchase the underlying asset when you buy a call option, you can limit your losses if things don't go as planned. This makes them ideal for conservative investors who want some exposure to stocks or other assets but aren't willing (or able) to risk losing all their money if prices take a dive.
