Option
An option gives the right, but not the obligation, to buy (call) or sell (put) an asset at a set price until a given date, in exchange for a premium.
The buyer of an option pays a premium. In return, they can buy (call) or sell (put) the underlying at the exercise price, or strike. Their maximum loss is limited to that premium.
The option seller collects the premium but takes on the opposite commitment. Their risk can be very high, and even unlimited on an uncovered call.
An option's price depends on the underlying price, the strike, the time left, interest rates and above all expected volatility. As expiry approaches, time value melts away: this is time decay. Options are powerful but complex tools, best learned separately from CFD trading.