Call Options | Trading for Newbies

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On this episode, we’re explaining call options.

A call option is a contract that gives the owner of the option contract the ability to buy a stock at a set price (the strike price). Episode 2 explains the mechanics of both buying and selling call options and the perspectives of buyers and sellers.

Episode Contents:

What Is A Call Option?
Buying A Call Option
Selling A Call Option

About Trading For Newbies

This series will educate you, the beginning trader on the basics of options trading and the tastytrade approach to trading. Our goal is to get you to the point where you will be able to actively find opportunities in the market, enter and exit trades, and clearly articulate what you are doing throughout the process.

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tastytrade is a real financial network, producing 8 hours of live programming every weekday, Monday – Friday. Follow along as our experts navigate the markets, provide actionable trading insights, and teach you how to trade. With over 50 original segments, and over 20 personalities, we’ll help you take your trading to the next level, whether you are new to trading or a seasoned veteran.

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MoneyManFernando says:

So if you sell a call you collect and keep the premium. Why do you say that the seller has unlimited loss potential ?? Explain please.

Joshua Swilling says:

so how do you make money from the call? were is the unlimited potential on income??
can someone exp[lain?

Vloxtun says:

Question– If someone buys a call option and the price of that option goes down in price and you are not at expiration yet, can that person then sell that same contract back to the market for a loss? All this in a effort to not lose their entire investment in the call option contract they bought?

bangbangs808 says:

What’s the point of a put then?! If u can short and long a call.

Laurent Briere says:

Thanks for your simplify explanations!

AprilCherry says:

So if you bought 100 shares of stock for $165, you should have the capital of $16,500 right?
actually, as the premium is 8.32×100=832, you paid for the stock for 16,500-832=15,668, anyone corrects me if I were wrong!

Keeping Up says:

I think Beef could have made an easy living as a Robin Williams impersonator.

Scott H says:

I noticed in the example of AAPL that you were using a strike price that was ITM. Is there a strategy for this or was it just an example?

jcoldboy says:

So my question is: selling a call is the same as buying a put?

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