Call options are used when you as the option buy are bullish on the underlying instrument and want to limit risk. Calls give you the buyer the right, but not the obligation, to buy an underlying asset. They are available in various strike prices depending on the current market price of the underlying instrument. Expiry dates can vary from one month out to more than a year (LEAPS options). Depending on the sentiment of the market, you might decide to buy (go long) or sell (go short) a call option. Typically beginners to options will start off their options trading by buying options, due to the additional risk involved with selling options.

If you want to buy or go long a call option, you purchase the right to buy the underlying instrument (a stock, index or ETF for example) at the selected strike price until expiry. The premium of a long call  appears as a debit in your trading account, as that is what you paid to purchase the call option. The premium amount is the maximum risk involved in a long call strategy.  You usually make a profit when the price of the underlying instrument rises above the strike price of the call. You can then choose to either exercise the call or sell a call with the same strike price and expiration date. By exercising a long call, you generally end up with 100 shares per option (for US markets), or 1000 shares for UK markets, of the underlying stock at the call strike price. You can then immediately sell the underlying shares at the current market (higher) price to generate a profit on the difference between two (current price - strike price = profit). If you want to offset the call option, there is unlimited profit. The call's premium will increase in value depending on how high the underlying instrument rises in price beyond the strike price of the call. As the price of the underlying instrument increases, the call which you own becomes more valuable. This is because it gives you the owner (or the person you sell it to) the right to buy the underlying stock at the lower strike price of the call option. This is why you can use call options to profit in a bull market.

The other side of the market involves selling (or shorting call options). If you want to sell or go short a call option, you are selling the right to buy the underlying stock at a certain strike price (or exercise price) to the holder of the option. Selling a call option will result in the deposit of a credit in your trading account in the amount of the call's premium. A trade-off of option selling is that it involves limited profit. You get to keep this credit if the option expires worthless. So to make money on a short call, the price of the underlyer must stay below the call's strike price. If the price of the underlying asset rises above the short call strike price, you will most likely be assigned. This means that the call option seller is required to deliver the option package (usually 100 shares of stock) at the strike price.

After assignment, the individual will be short those shares unless they already had a long position in the stock. The option seller may need to buy the underlying stock at the current market price after selling it at the call's lower strike price, thereby incurring a loss on the trade (current price - strike price = loss). The maximum loss is therefore unlimited to the upside, which is why selling "naked" or unprotected call options comes with such a high risk.

Call options give you the right to buy something at a specific price for a specific time period. If the current market price is more than the strike price, the call option is in-the-money (ITM). If the current market price is less than the strike price, the call option is out-of-the-money (OTM). If the current market price is the same as (or close to) the strike price, the call option is at-the-money (ATM).