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An asymmetric payoff (also called an asymmetric return) is the set of possible results of an investment strategy where the upside potential is greater than the downside risk. [1] Derivative contracts called “options” are the most common instrument with asymmetric payoff characteristics. [ 2 ]
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The most bearish of options trading strategies is the simple put buying or selling strategy utilized by most options traders. The market can make steep downward moves. Moderately bearish options traders usually set a target price for the expected decline and utilize bear spreads to reduce cost.
Options: contracts that give the owner the right, but not the obligation, to buy (in the case of a call option) or sell (in the case of a put option) an asset. The price at which the sale takes place is known as the strike price , and is specified at the time the parties enter into the option.
In the financial world, options come in one of two flavors: calls and puts. The basic way that calls and puts function is actually fairly simple. A call option is a contract giving you the right to...
Options traders look to be preparing for further falls in bitcoin's price in the short term, according to put-call skew data. Bitcoin Option Traders Hedge Against Downside Risk as Price Dips to ...