What is the difference between a call option and a put option?

A call option gives the option buyer the right, but not the obligation, to buy a certain amount of stock on or before a certain date for a certain price. A put option gives its buyer the right, but not the obligation, to sell stock on or before a certain date for a certain price How the options are exercised is another difference. If you bought a put, you're hoping the stock price falls below the strike price--the certain price in the contract.It would make no sense to sell stock for $10 a share if it's $15 now, right?

Calls exercise when their stock price goes above the strike price.

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