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Prasiatko t1_jac5s2f wrote on February 28, 2023 at 11:14 AM

Reply to comment by cshaiku in ELI5 - What are calls/puts in stock trading, and how are returns calculated when they are executed? by burman07

A call is basically an option to buy eg 1 share of ACME corporation at the price of $10 on or before a certain date. If the market price goes above $10 you would want to use the option to buy at $10 and then sell immediately at the higher market price.