How does Call Option work?
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A call option is a derivative contract that allows option buyers the right or option to buy or not buy an underlying asset at the strike price. Per call options basics regulations of the SEBI, investors who buy a call option are not obligated to exercise the option if the trade means incurring a loss. As such, they may choose against purchasing the asset at the strike price. They may also decide when and whether to exercise the option to exit the agreement, but they must do so before the contract expiry period.