WHAT ARE OPTIONS? AND THE DIFFERENCES BETWEEN OPTION WRITING, TRADING AND SELLING.
- Option Seller / Writer: Write, Sell and Collect Premium
- Option Traders: Buy, Sell and Make the Difference
WHAT ARE THE 4 FACTORS THAT WORK AGAINST OPTION TRADERS
- Spread – The difference between the Bid and Ask Price
- Time Decay – Premium of any options (ie: Put or Call) decreases across time
- No Dividends – Because Option Buyers own nothing of the company, they receive nothing.
- Psychological Factor – Humans tend to believe that if you win 10 times in a casino using small amount of money, they will win the 11th time using a large amount of money!
“WHAT IS A BEAR CALL SPREAD?” BY VIA, VALUE INVESTING ACADEMY
A bear call spread is a two-part options strategy that involves selling a call option and collecting an upfront option premium, and then simultaneously purchasing a second call option with the same expiration date but a higher strike price.
So, would you be keen to learn on how to invest safely and consistently across the companies that you have come across?
Disclosure
The above article is for educational purposes only. Under no circumstances does any information provided in the article represent a recommendation to buy, sell or hold any stocks/asset. In no event shall ViA or any Author be liable to any viewers, guests or third party for any damages of any kind arising out of the use of any content shared here including, without limitation, use of such content outside of its intended purpose of investor education, and any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages resulting from such unintended use.
