Option — Trading

Options trading involves buying or selling contracts that give you the right—but not the obligation—to buy or sell an asset (like a stock or ETF) at a set price within a specific timeframe.

: You buy a put if you expect the price to fall. This is often used for speculation or as "insurance" for stocks you already own (a Protective Put ). OPTION TRADING

: You sell a put and set aside enough cash to buy the stock if the price falls to the strike price, effectively getting paid to wait for a better entry point. Risk vs. Reward Options trading involves buying or selling contracts that

: The agreed-upon price at which the asset can be bought or sold. : You sell a put and set aside

: You own the stock and sell a call against it. This generates immediate income (the premium) but caps your potential profit if the stock price soars.