What would typically happen if an investor purchases a call option?

When an investor purchases a call option, they acquire the right, but not the obligation, to buy a specific amount of an underlying asset, typically shares of stock, at a predetermined price (the strike price) before the option expires.

The primary feature of call options is that they limit the downside risk for the investor. The maximum loss for the option holder is confined to the premium paid for the call option, regardless of how low the underlying stock price might fall. Therefore, the potential loss is limited, which provides a safety net compared to holding the underlying stock directly, where losses could be significant if the price were to decline sharply.

This feature helps investors manage risk and is why the answer indicating that they would limit the amount of money they could lose is correct. In contrast, the other choices do not accurately reflect the nature or common outcomes of purchasing a call option.