Financial Tutorial
 

Options: Basic Strategies - Unlimited Risk
All information are subject to terms of use

Selling uncovered options is very dangerous. The purpose of this section is not to encourage you to issue options but well to explain the mechanisms.

SHORT CALL

To be used when a decrease of the underlying security price is expected.
Maximum risk: UNLIMITED.
Maximum profit: limited to premium received.

SHORT PUT

To be used when an increase of the underlying security price is expected.
Maximum risk: UNLIMITED.
Maximum profit: limited to premium received.

Go to: Top of page - Next Topic - Option Index - Home