OPTIONS TRADING

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OPTIONS TRADING📈



Options trading is a financial strategy that involves contracts granting the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specified timeframe.

Types of Options🎯

Call Option: Grants the holder the right to buy the underlying asset at a set price (strike price) before the option expires.

Put Option: Grants the holder the right to sell the underlying asset at a set price before the option expires. Investors purchase put options when they anticipate the asset's price will decline.

Key Components of an Option📊

Strike Price: The predetermined price at which the underlying asset can be bought or sold.​

Expiration Date: The date by which the option must be exercised.​

Premium: The cost paid by the buyer to the seller to acquire the option.​

Underlying Asset: The financial instrument (e.g., stock, index) on which the option is based.

Why Trade Options?

Leverage: Options allow investors to control a larger position with a relatively small investment.​

Hedging: Options can serve as a form of insurance to protect against potential losses in other investments.

Income Generation: Through strategies like writing covered calls, investors can earn premiums.​

Speculation: Traders can profit from anticipated price movements without owning the underlying asset.



                                                      INSTAGRAM LINK

https://www.instagram.com/reel/DIRB-5STtxb/?igsh=MXczejJ4NGNhbmJzeQ==


                                                                        YOUTUBELINK

https://youtube.com/shorts/nyZutwv1u7o?si=akvWdA0QbeQ1MsPC


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