Part 1 How to Draw Accurate Support and Resistance Levels

The Key Components of an Option Contract

Underlying Asset:
The financial instrument (e.g., stock or index) on which the option is based.

Strike Price:
The price at which the holder of the option can buy (for calls) or sell (for puts) the underlying asset.

Expiry Date:
The date on which the option contract expires. In India, options can be weekly or monthly.

Premium:
The price the buyer pays to purchase the option contract from the seller (also known as the writer). This premium is non-refundable.

Lot Size:
Each option contract represents a fixed quantity of the underlying. For example, one NIFTY option lot equals 50 units, while one BANK NIFTY option equals 15 units.