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Options solve it in the sense that you limit your downside, but you can still very well lose your premium. Even if you're 100% convinced that $TSLA is overvalue
by cglouch 10y ago
Options solve it in the sense that you limit your downside, but you can still very well lose your premium. Even if you're 100% convinced that $TSLA is overvalued, markets can remain irrational longer than you can remain solvent, and your puts may very well expire worthless.
- jfoutz 10y agoWell, yes. But that's a different thing than the infinite risk of a naked short.