Investors' Alphabet: O is for Options

When advisers talk of giving clients as many options as possible, chances are they're not talking about financial instruments.

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In most investors' lives, "put options" is a term reserved for the golf course, while "call options" are for emergencies only.

Yet options are no longer just the preserve of financial wunderkinds and directors buying into their own companies at attractive prices. They are becoming increasingly common in investors' portfolios.

As an option is quite literally an option to buy or sell something at a particular price, it can come in handy if you need to buy something whose price is unstable. Put options are the options to sell. Call options are the options to buy.

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