An option is a contract between two parties giving the right, but not the obligation, to buy or sell a parcel of water at a predetermined price on or before a predetermined date. That right is paid for and called the ‘premium’.
Every option contract has both an Issuer and a taker, a predetermined premium, exercise price and exercise period. There are Put options and Call options.
A put option provides the right but not the obligation to sell your water at a predetermined price at a predetermined point in time.
A Call option provides the right but not the obligation to buy water at a predetermined price at a predetermined time.
Water Options can be entered into for temporary or permanent water.