A study on call_and_put_options

Jun 28th, 2015
Studypool Tutor
A. T. Still University
Price: $25 USD

Tutor description

long Put Action: Buying a Put option Expectation: Stock/Market will be Bearish Profit: Unlimited on stock price/market falling Loss: Limited to amount invested into position (premium) Breakeven: Strike price – premium

Word Count: 2084
Showing Page: 1/9
Infinanceanoption strategyis the purchase and/or sale of one or variousoptionpositions and possibly anunderlyingposition.Options strategies can favor movements in the underlying that are bullish, bearish or neutral. In the case of neutral strategies, they can be further classified into those that are bullish on volatility and those that are bearish on volatility. The option positions used can belongand/orshortpositions incallsand/orputsat variousstrikes.Bullish strategiesBullish options strategies are employed when the options trader expects the underlying stock price to move upwards. It is necessary to assess how high the stock price can go and the time frame in which the rally will occur in order to select the optimumtrading strategy.The most bullish of options trading strategies is the simple call buying strategy used by most novice options traders.Stocks seldom go up by leaps and bounds. Moderately bullish options traders usually set a target price for the bull run and utilize bull spreads to reduce cost. (It does not reduce risk because the options can still expire worthless.) While maximum profit is capped for these strategies, they usually cost less to employ for a given nominal amount of exposure. Thebull call spreadand thebull put spreadare common examples of moderately bullish strategies.Mildly bullish trading strategies are options strategies that make money as long as the underlying stock price does not go down

Review from student

Studypool Student
" Totally impressed with results!! :-) "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1823 tutors are online

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors