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You don't mention the downside of buying options... If it goes up, but doesn't hit the strike, you lose all your money. Options are a pretty risky play and it's
by wengzilla 14y ago
You don't mention the downside of buying options... If it goes up, but doesn't hit the strike, you lose all your money. Options are a pretty risky play and it's typically not recommended that your average investor play the options market.
- minimax 14y agoFrom the article: > There are lots of ways to combine options for different stock outlooks. Here are some common ones, not accounting for option cost. He does mention it, but it's not very prominent. I also agree that not including the cost of opening the position in the payoff chart is misleading (and unconventional).
- npongratz 14y agoThe author mentioned this risk in the second paragraph: > ... in fact, you can lose everything even if the stock goes up, but not by enough.