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Each and every owner of any option contract is free to exercise it, at any given point of time. An option exercise will demonstrate that a specific financial transaction which has been mentioned under a contract, must essentially get enacted right away. This is done among the 2 parties of that specific contract. Once the option exercise has been done, this particular contract will come to an end. When the owner of any options purchases its underlying share at their strike price through an option seller, at the time of exercising their calls, and also for put, the owners of these options can sell these underlying to any options seller. In each of the Options Trading investing, an option exercise is referred to as bringing into effect all your rights to acquire any underlying stock, at the time when you are in possession of the call options. Alternatively you may sell these underlying stocks while you are still holding the put options. Also a call option will essentially give you the rights to acquire a specific underlying stock, at a particular rate whereas a put option gives you the rights to dispose off any underlying stock at a particular rate. Yet this will not imply that these right will occur automatically prior to the expiry of these options. In other words , options are often referred to as a “Contingent Claim” in the financial language. This implies that a claim has been considered to be fairly contingent on their holders. Each and every holder is at a sole discretion to determine, if they would prefer to enforce these rights or not. Such a process of exercising their options is known as an ” option exercise “. All of the investment strategies, that have been co-related to a specific investing of options, is also referred to as a Cover Call.