What is Options Market?

An options market is an investment marketplace for options derivatives contracts which facilitate an agreement between two parties to carry out a potential transaction for an underlying security at a predetermined price on or prior to the expiry date of the contract. Options markets allow investors to bet on the potential direction of an asset, which are categorized as either a put option — a leveraged bet on the potential increase in price of a stock or index — or a call option, with the hope of profiting from future price depreciation.