There are several fundamental concepts that are important to understand when learning about option trading. These include:

1. Option Types: We can categorise options as either "call" or "put," with the former being the more common of the two. The holder of a call option has the right, but not the responsibility, to acquire the underlying asset at the option's strike price during the option's term price (strike price) by a certain date (expiration date). The holder of a put option has the right but not the duty to sell the underlying asset on or before the expiration date of the option and at the strike price of the option.
2. Strike Price: a price at which the underlying asset can be bought or sold if the option is exercised.
3. Expiration Date: is the date on which the option expires and can no longer be exercised.
4. Premium: The premium is the price of the option, and it is determined by a number of factors, including the strike price, expiration date, and the volatility of the underlying asset.
5. Volatility: is a measure of how much the price of an asset tends to fluctuate. Options that have a high volatility tend to have a higher premium.

For example, if John wants to buy a call option for IBM stock with a strike price of $100 and expiration date of 1 month from now , he would pay a premium for the right to purchase IBM stock at $100 at any time in the next month.

Another example: If Jane wants to sell a put option for XYZ stock with a strike price of $50 and expiration date of 3 months from now, she would receive a premium for the obligation to buy XYZ stock at $50 at any time in the next three months if the option is exercised.