Options 101: The Four Basic Positions Explained Through Gold

October 18, 2026 · 11 min read

When you first encounter options, four terms come up again and again:

Buy a call. Sell a call. Buy a put. Sell a put.

These are not four unrelated strategies. They are combinations of two choices:

• Are you trading a call or a put?
• Are you buying it or selling it?

To understand these four basic positions, start with one idea: an option gives its buyer a right to transact in the future. Trading that right is different from buying or selling the asset itself.