When trading options, the trading tip that Cash is King applies in more than one instance. When in doubt--get out! If you have made a trade and are starting to have second thoughts or you don't see the underlying stock move in the direction that you had anticipated, it might be a sign for you to get out and take your cash off the table. There are only 2 types of stock option contracts: Puts and Calls. Every, and I mean every, options trading strategy involves only a Call, only a Put, or a variation or combination of these two. Puts and Calls are often called wasting assets. They are called this because they have expiration dates. Call and put options are derivative investments, meaning their price movements are based on the price movements of another financial product, which is often called the underlying. A call option is bought if the trader expects the price of the underlying to rise within a certain time frame.