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Part 4 Learn Institutional Trading

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Participants in Options Market

Hedgers: Farmers, companies, or investors protecting against risk. Example: An airline hedging fuel cost with options.

Speculators: Traders betting on market moves with limited capital.

Arbitrageurs: Exploit mispricing between options and underlying.

Why Trade Options?
✅ Advantages:

Leverage: Small premium can control large value.

Flexibility: Can profit in any market condition.

Defined Risk: Buyer’s maximum loss = premium paid.

Income Strategies: Writing options to earn premium.

❌ Risks:

Time Decay: Options lose value daily.

Complexity: Many moving factors (Greeks, volatility).

Unlimited Losses (for Sellers): If selling naked options.

Penafian

Maklumat dan penerbitan adalah tidak bertujuan, dan tidak membentuk, nasihat atau cadangan kewangan, pelaburan, dagangan atau jenis lain yang diberikan atau disahkan oleh TradingView. Baca lebih dalam Terma Penggunaan.