Options generally refer to options contracts rather than the options represented by those contracts. An options contract is a type of contract that gives one party the right to buy something at a given time in the future from a particular seller. It does not refer to stock options unless stock is the commodity represented in the contract. Common stock is only one type of commodity that can be transacted under an options contract.

Options contracts don't imply a sale. Instead they imply a possible sale by granting the potential buyer the option to choose whether or not they wish to purchase the commodity. The buyer never has to make the actual purchase. Typically the option sets a fixed price for the commodity and a fixed or final date for purchase. If the owner of options can purchase the actual commodity at that price on or before the associated date at a price which is favorable to them, they will probably exercise the option and make the purchase. If the price is too high at that time, they can choose not to exercise the option, and the contract expires.

Options can be a risky form of investment, since the option is essentially worthless if the market value of the commodity never matches the price set for the commodity in the contract.

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