Millásreggeli #04 - Miből lehet profitálni az opciós kereskedésben
The higher the OTM level of the option, and the closer the option to expiration, the bigger the probability that the capital will be lost and the level of risk increases. With the approaching expiry date, the number of days to change to ITM decreases and the risks further increase.
European options cannot be executed before expiration date. The only way to realise profits before expiry is to sell them. Certain options have risks at execution. In this case the option will expire worthless and lose its value.
Courts or other authorities e. Options Clearing Corporation OCC can introduce enforcement limitations which prevent to realise profits. The written options can be executed any time before expiration.
Although American options can be executed before expiration, in reality early assignment only happens with ITM options shortly before expiration. When the buyer executes the options, the seller must deliver the underlying security Call option or must buy the underlying security Put option.
Covered Call traders give up the right for further profits as soon as the share price rises above the strike price of the option. The profit - apart from the dividends - is the premium of the Call option.
When the Call option is executed, the writer must sell the shares for the price agreed in the contract. Thus, a sudden price increase can result significant losses for the writer of a Naked Call option. When the Put option is executed, the writer must purchase the shares for the price agreed in the contract.
Thus, a sudden price decrease can result significant losses for the writer of a Naked Put option. The writer of a naked option undertakes the coverage risk if his position generates losses.
Brokers grant liquidity to hedge such risks. Writers of Call options can lose more money on the same price az opciók kockázatmentesen kereskednek than on a short position of the share. The writer of the Naked Call must deliver the shares for the az opciók kockázatmentesen kereskednek price when the option is executed.
Options can be executed after the market closes 9.
Writers of options have the obligation even when the market is unavailable, thus they may not be able to close their positions. Other risk factors 1.
The complexity of some option strategies are a significant risk in itself. This is especially true for complex portfolios based on selling and buying options.
Writers of Straddle options must face unlimited risk.
The option markets and the option contracts are continuously changing. The conditions and validities are not constant. The option market has the right to suspend the trading of any options, preventing to realise profits. Incorrect execution of options may occur.
When an option brokerage goes out of business, the investors can be harmed. International options bring special risks because of the difference in the time zones. Now the risks are going to be examined on the micro level. Uncovered option positions come with unlimited risk.