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What are the risks and rewards of selling out of the money calls in the cryptocurrency space?

avatarKurakula NagarajuDec 17, 2021 · 3 years ago1 answers

What are the potential risks and rewards associated with selling out of the money calls in the cryptocurrency market? How does this strategy work and what factors should be considered before implementing it?

What are the risks and rewards of selling out of the money calls in the cryptocurrency space?
Cryptocurrency
Out Of The Money Calls
Risks

1 answers

  • avatarDec 17, 2021 · 3 years ago
    Selling out of the money calls in the cryptocurrency space can be a profitable strategy if executed properly. By selling these options, traders can generate income upfront by collecting the premium. However, there are risks involved. If the price of the underlying cryptocurrency rises above the strike price, the seller may be obligated to sell their cryptocurrency at a lower price. On the other hand, if the price remains below the strike price, the seller keeps the premium and avoids the obligation to sell. Traders should carefully analyze market trends and volatility before implementing this strategy.

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