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Covered Option Meaning In Bengali
Covered Option শব্দের বাংলা অর্থ কি: আবৃত বিকল্প
Covered Option
Definition
1) A financial contract that gives the seller the obligation to deliver the underlying asset if the buyer chooses to exercise the option.
2) An option position that is fully collateralized to meet the potential obligations.
3) An option position that is backed by the holdings of the underlying security.
Examples
Covered Option Example in a sentence
1) The investor decided to sell a covered option on the stock to generate additional income.
2) An example of a covered option strategy is when an investor holds the underlying asset while selling a call option.
3) Selling a covered option involves owning the underlying security to provide protection against potential losses.
4) A covered option position can be profitable if the stock price remains stable or increases.
5) Investors using a covered option strategy have limited risk compared to selling naked options.
6) Writing covered options can be a conservative approach for generating income from a stock portfolio.
7) Managing risk is a crucial aspect of trading covered options to ensure potential losses are minimized.
8) It's important for investors to understand the obligations and risks associated with selling covered options.
9) Utilizing a covered option strategy allows investors to potentially profit from both the premium and any capital gains in the underlying asset.
10) A covered option position can be closed by either letting the option expire worthless or by buying it back before expiry.
Synonyms
Encyclopedia
A financial contract that gives the seller the obligation to deliver the underlying asset if the buyer chooses to exercise the option.
An option position that is fully collateralized to meet the potential obligations.
An option position that is backed by the holdings of the underlying security.
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