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Sell Call

#pixarts.trade , #safebull

Pixarts Trade August 9, 2023 05:16 PM

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Market View – Mildly Bearish The Trade – Sell a Call Option Premium – Receive Margin – Required When To Do Pros Cons Time and Volatility Max Loss : Very high Max Profit : Premium

Market View – Mildly Bearish

The Trade – Sell a Call Option

Premium – Receive

Margin – Required

When To Do

  • If the stock will not go up – that is i) stays still, ii) small or big down move or iii) A very small up move
  • Avoid selling when IV and premium is low

Pros

  • Make money even if you are slightly wrong, that is the stock moves up a bit

Cons

  • Very high loss if stock moves up a lot

Time and Volatility

  • Gains time value every day
  • Loss if IV goes up

Max Loss : Very high

Max Profit : Premium

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