A. Features of Stock Options - Stock Option is an American option, and can be exercised any time up to its expiration.
A stock option buyer has the right to buy or sell the underlying stock at the strike price (the pre-determined price) on or before the expiry date. When the stock option is exercised, stock option seller has the corresponding obligation to fulfill the transaction.

B. Uses of Stock Options - Earning Opportunities: Investors can gain profit from bullish, bearish or even stagnant market.
Hedging: Using put options to protect downside risk while capturing upside in the underlying stocks.
Yield enhancement: Stock investors can short call against stock already held to receive the premium, earning additional income.
Leveraged effect: Stock options is a leveraged investment tool. Investors can use his capital more efficiently to gain leveraged return in different market situations.

C. Factors that affect option pricing: - Theoretically, there are six factors that affect option pricing:

From the above, the higher the underlying stock price, the longer the time until expiration, the higher the volatility and interest rate will result in a higher call premium. On the other hand, the higher the underlying stock price and expected cash dividends will result in a lower put premium.