Strike Price

Strike price is the fixed price at which you can buy or sell a stock through an options contract (a bet on future stock movement). You'll see this term whenever you're trading options—contracts that give you the right, but not the obligation, to buy or sell shares at a set price by a certain date. It matters because the strike price determines whether your options contract makes money or loses it. For example, if you buy a call option (the right to buy) on TechCorp stock with a $50 strike price, you're betting the stock will rise above $50. If it does, your contract becomes valuable. If it stays below $50, your option expires worthless.