Stock options

[pittagoda]

How to trade? PUT and REMOVE telusu but not PUT and CALL. Explain please

[ekunadam_enkanna]

Don't even play with options, unless you have some stock to protect, since you are here looking for explanations.

[pittagoda]

Just now, ekunadam_enkanna said:

Don't even play with options, unless you have some stock to protect, since you are here looking for explanations.

Means? Stock to protect means? 

[ekunadam_enkanna]

Just now, pittagoda said:

Means? Stock to protect means? 

Imagine you own 20K shares of a company A today. What will happen if the stock A tanks by 40% in another eight months?  You will lose 40%. Is there a way to protect your investments? You can buy 200 put options (1 option contract accounts for 100 shares). In the event this stock tanks, your put option makes you money; otherwise, you loose money on put options. Usually, many players use options to hedge. Other times, you can also sell option contracts because you have 1M shares of some company. 

 

[pittagoda]

12 minutes ago, ekunadam_enkanna said:

Imagine you own 20K shares of a company A today. What will happen if the stock A tanks by 40% in another eight months?  You will lose 40%. Is there a way to protect your investments? You can buy 200 put options (1 option contract accounts for 100 shares). In the event this stock tanks, your put option makes you money; otherwise, you loose money on put options. Usually, many players use options to hedge. Other times, you can also sell option contracts because you have 1M shares of some company. 

 

How does put makes money when the stock tanks? 

What is hedge?

How do you have 1M shares?

[jpismahatma]

Just do Youtube yaaa..