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The advantage of options accrues to their buyer: if a stock's price goes the wrong way, you don't have to execute the option so you won't be out very much money. An example, please: You bought a 90-day "put" option on Acme at $20 on July 1. This gives you the option of selling your Acme shares for $20 at some time during the 90 days covered by the contract. If the price of Acme shares on the open market falls to $18 because Earthquake Pills turn out to start hurricanes, you get to sell your shares for $20, not $18, and you'll be happy. If, OTOH, the stock rises to $23 on the news Acme has the first hurricane pill on the market, you'd be better off selling Acme to someone else so you just let the contract run out. If you had bought a put future instead of a put option, you would have been required to sell your Acme at $20 even if it went to $32 on the news they also had a tornado pill in the works.
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