An options exchange is a marketplace where traders can buy and sell options contracts. These contracts give investors the right, but not the obligation, to buy or sell an underlying asset, such as stocks, at a predetermined price within a specific time frame. Options exchanges facilitate these transactions by providing a platform for price discovery and liquidity. Major options exchanges include the Chicago Board Options Exchange (CBOE) and the NASDAQ Options Market. They operate under strict regulations to ensure fair trading practices and transparency. By connecting buyers and sellers, options exchanges play a crucial role in the financial markets, allowing for risk management and investment strategies.