Note: Only sell "Covered Calls" (where you already own the shares) to limit risk. Selling "Naked Calls" has infinite risk and is not recommended for beginners. Limited to the premium received. 4. Key Terms to Know
The stock stays below the strike price. You keep the entire premium as profit. buying and selling call options
High IV makes options more expensive. Buying when IV is low and selling when IV is high is a common strategy. 5. Steps to Trade Note: Only sell "Covered Calls" (where you already
You don't have to wait for expiration. You can "sell to close" a bought call or "buy to close" a sold call at any time to lock in profits or cut losses. High IV makes options more expensive
You buy a call if you expect the stock price to rise significantly. You pay a fee called a Premium .