1. Leverage: Options allow investors to control a larger position with a smaller investment, amplifying potential returns (and losses).
  2. Risk Management: Options can be used to hedge against downside risk or volatility in the market.
  3. Income Generation: Selling options can generate income through premiums, especially in stable or declining markets.
  4. Speculation: Traders can profit from price movements in the underlying asset without owning it outright.
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