Buying And Selling - Calls And Puts

: Realized if the stock price moves above the strike price plus the premium paid. Long Put (Bearish) Goal : You expect the stock price to fall . Right : You can sell the stock at the strike price. Risk : Limited to the premium paid.

: This is the price you pay (as a buyer) or receive (as a seller) for the contract. If an option is quoted at , the actual cost is buying and selling calls and puts

When you buy an option, you have the , but not the obligation , to trade the stock. Long Call (Bullish) Goal : You expect the stock price to rise . Right : You can buy the stock at the strike price. Risk : Limited to the premium paid. : Realized if the stock price moves above