Friday, September 25, 2020

INTC stock: Options - I have to learn and think about carefully

 Here is the article. 

Take some time to read, and I should get ideas how to talk about options in English first. 


Setting A Stop Loss

You can calculate the maximum loss by taking the difference of the spreads minus the premium collected ($2.50 — 65 cents). If INTC stock closes above 52.50 on Oct. 16, the premium seller loses $185 on the trade per contract. No matter how far down Intel goes, the loss on this trade won't get bigger than that.

For a trade like this, I would set a stop loss if the spread doubled in value to $1.30. Remember, when the spread trades at a higher price than your credit of 65 cents, you are losing money.

Also remember that options are risky and investors can lose 100% of their investment.

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