SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Canadian Options
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Marwan Forzley who wrote (552)6/10/1997 12:27:00 AM
From: Ryan   of 1599
 
Marwan,
I don't profess to be a pro but will hopefully answer your question. An investor who is very bullish on a stock would likely purchase call options as there is unlimited upside potential and the capital required is far less than the purchase of the stock.

On the other hand, a 'bull spread using calls' strategy could be used if the investor is bullish but believes the rise will be limited. This spread technique will limit the profit potential to a finite amount but will also limit risk and lower the break even point of the investment. So unless you are positive the stock will rise then consider the spreads to hedge your investment. To achieve the best of both worlds you may purchase a 'time spread' where you write a call--short term expiry and purchase a call--long term expiry. If you get lucky the stock will 'take off' after expiry of the written call and you will continue to have unlimited upside potential while being rewarded with the premium from the written call.

-Ryan
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News