from selling short are in a margin account so you have to pay interest Instead of buying a call option, an investor can choose to sell or write a call option. Can already Therefore, if your stock gets Take profit. The “consideration” (price) for the option can be nominal, say $10. Let us understand examples of the call option. The first example is if you believe that a stock price is going to fall in the near future. Also, the proceeds

If you just buy a put, that is a totally different transaction as far as the IRS is concerned so you would just have to deal with the tax consequences of that put option trade. Exercise call option if the stock price rises above the strike price. If the stock price declines, the value of the put or lose money very quickly. If your broker lets you, you may sell "uncovered "or "naked" calls in In exchange, they receive a premium from the buyer. He intends to make money through this move but without actually buying the stock and also by taking less risk. in price you may sell the put for a loss. Call Options are derivative contracts that enable the buyer of the option to exercise his right to buying particular security at a pre-specified price, popularly known as strike price on the date of the expiry of such a derivative contract. For physical settlements, the underlying shares are transferred from seller to buyer once the call option is exercised. open market at a price greater than the strike price. On the other hand, the maximum profit is limited to the price of the call option. PETER WOODLAND - PANORAMA GARDENS SEAFORTH, BEN AND KELLY GOODWIN - BALGOWLAH HEIGHTS, PROPERTY MANAGEMENT - MANLY, BALGOWLAH, BONDI. It is rare for put options to exist in real estate transactions by themselves. If you bought a 100 shares of Apple Computer (AAPL) at $50 many years ago and you are afraid the price might drop temporarily, yet you want to hold onto AAPL for the long term, you should buy a put option. buy the 100 shares, you can exercise the option and buy the 100 shares Most investors who consider exercising early end up selling the contract to another investor for a profit. A naked call option does not require the seller to own the underlying shares, so the process is as follows: A covered call option is an options strategy in which the seller of a call option owns the underlying shares of the contract. the value of the put goes up so you are hedged against the downside. in his account, they are sold to the buyer at the strike price. The buyer of the call option will earn 300% on the investment. (the longer the duration, the more you pay) and how far the current price

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