What are long calls and puts in the context of cryptocurrency trading?

1 answers

• Hadi KhanFeb 03, 2023 · 2 years ago
  Long calls and puts are commonly used in cryptocurrency trading to take advantage of price movements without the need to own the actual cryptocurrencies. A long call option gives the holder the right to buy the cryptocurrency at a predetermined price, while a long put option gives the holder the right to sell the cryptocurrency at a predetermined price. Traders can use long calls to profit from upward price movements and long puts to profit from downward price movements. These options provide leverage and can amplify potential gains or losses. However, it's important to understand the risks associated with options trading and to carefully consider factors such as volatility and time decay before entering into such trades.
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