What is a Put Option. More specifically, a put option is the right to SELL 100 shares of a stock or an index at a certain price by a certain date. It is full of examples showing actual trading wins (and a few losses) from trading. Call option and put option trading is easier and can be more profitable than most people think. If you have never traded them before, then this website is designed for you. Also known as covered write.
To learn more about buy write, seecovered call writing. metatrader helper video This is a limited time offer. You May Also Like Continue Reading. Buying Straddles into EarningsBuying straddles is a great way to play earnings.Many a times, stock price gap up or down followinBetter Together.
Never miss a trending story with yahoo.comas your homepage. Every new tab displays beautiful Flickr photos and your most recently visited sites. A collar is an options trading strategy that is constructed by holding shares of the underlying stock while simultaneously buyingprotective puts and selling call optionsagainst that holding.
The puts and the calls are bothout-of-the-money options having the same expiration month and must be equalin number of contracts. Collar Strategy ConstructionLong 100 SharesSell 1 OTM CallBuy 1 OTM PutTechnically, the collar strategy is the equivalent of aout-of-the-money covered call strategy with the purchase of an additional protective put.The collar is a good strategy to use if the options trader is writing covered calls to earn premiums but wish to protect himself from an unexpected sharp drop in the price of the underlying security.
I say generally because there are such a wide variety of option strategies that use multiple legs option long call short put up crossword their structure, however, even a one legged Long Call Option can be viewed as an option strategy.Under the Options101 link, you may have noticed that the option examples provided have only looked at taking one option trade at a time. How could a trader profit from such a scenario.