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Buying Calls vs. Buying Puts: Strategies and experiences
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Understanding the meaning: Buy a call: Call options are financial contracts that give the option buyer the right but not the obligation to b もっと見る
Understanding the meaning:
Buy a call: Call options are financial contracts that give the option buyer the right but not the obligation to buy a stock, bond, commodity, or other asset or instrument at a specified price within a specific time period. A call buyer profits when the underlying asset increases in price. Learn more here.
Buy a put: A put option may be contrasted with a call option. It gives the holder the right to sell the underlying asset at a specified price on or before expiration. Learn more here.
Generally, the value of calls and its underlying stock move in the same direction, while the value of puts and its underlying stock move in the opposite direction. Please note, this is a simplified explanation as there are numerous other factors that can affect options pricing, such as implied volatility, time to expiration, etc. If you're bullish, you may consider buying calls, and if you're bearish, you may consider buying puts.
We are wondering:
Have you traded calls or puts before? When do you typically buy a call option versus a put option? What are the pros and cons of each approach? What do you look for when selecting a strike price and expiration date for your options?
Share your experiences with us and learn from others about the long call and long put option strategies.
Reward: Top 10 excellent posts will get 800 points (based on quality and total likes). All posts with more than 20 words will get 28 points.
Time: Through August 22, 2023
Note: Please avoid specific details of setting up an options trade (e.g. picking the underlying, expiration date, and strike prices). Please keep it more high level and a discussion of options concepts. The focus should be on education and not advice.
Important: Options trading is very risky and is not appropriate for all customers. Read the Characteristics and Risks of Standardized Options before considering trading options. Please check the disclaimer here.
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