Call Option and Put Option Trading
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Option traders will buy calls when they think the underlying stock or index will move up. One of the most obvious advantages of a call option is that it is much understanding call options to buy than buying the stock itself. However, like all options, you have to plan your trade to make sure you are not taking on too much risk. A call option gives you the right to buy the stock for the strike price.
In the chart below you can see Oracle Corp ORCL beginning to break out of a consolidation range in the direction of the prior positive trend. In this case, you could have purchased a call option ideally with a strike price as close to the current stock price as possible to take advantage of higher prices in the future.
Expiration was June understanding call options, 37 days into the future. Many traders assume that you must hold an option until expiration before harvesting profits. This is not the case. The call option itself will rise in value as the understanding call options of the stock moves, and understanding call options can sell it at any time before expiration and collect profits. There are three things that you should learn from the example above.
First, you can buy and sell an option contract whenever you want. Understanding call options do not need to wait for expiration.
In the video, we will talk about how time value works in the option market understanding call options why it is something you need to understand and plan for.
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A prospectus contains this and other information about the fund and is available from the issuer. Options involve risk and are not suitable for all investors. Toggle navigation Understanding call options Markets.