An option's strike price is the price at which the contract's underlying assets may be sold (in the case of a put option) or purchased (in the case of a call option) by the option contract's owner.

When it comes to options, strike prices are key in determining the value of an option and the potential for profit or loss.

A bull call strategy is executed by purchasing call options at a specific strike or exercise price while also selling the same number of calls of the same asset at a higher strike price.

You pay a fee, called a premium, for the contract. That gives you the right to buy the stock at a set price, known as the strike price, at any point until the contract's expiration date.

Paid non-client promotion: Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However ...