Turn any market movement to your advantage

Use options to get the most out of your trading strategy. Hedge individual positions or your entire portfolio — the new service helps you select an options strategy with predictable results for any market scenario.

Popular strategies

Choose a strategy that fits your goals

Select a price movement scenario for the underlying asset and evaluate the potential risk-reward ratio. Monitor your portfolio and adjust positions to align with your investment objectives

FAQ

A European-style call option gives the holder the right to buy a specific asset at a predetermined price (strike price) at expiration. Investors use call options when they expect the asset price to rise. This allows them to acquire the asset at a more favorable price than the market price if their forecast proves correct.

A European-style put option gives the holder the right to sell a specific asset at the strike price at expiration. Investors choose put options when they expect the asset price to decline. This allows them to lock in a higher selling price than the market price if the price actually falls.

American-style options can be exercised at any time before expiration.

How to use

Call and put options, along with options strategies, are used for hedging risks or speculating on price movements. Hedging helps protect against unfavorable changes in asset values, while speculation allows investors to profit from market fluctuations. They also enable novice investors to explore the market without significant financial risk.

While options provide flexibility and profit opportunities, they also carry risks that investors must consider:

Premium loss riskThe option buyer may lose the entire premium if the option expires out of the money, meaning the option is not exercised.
Potentially unlimited losses for sellersCall option sellers may face unlimited losses if the underlying asset price rises sharply. Put option sellers are at risk in the event of a significant price decline.
Time decay riskOptions have an expiration date, and their value can rapidly decrease as expiration approaches, leading to potential losses.
Market volatilityChanges in volatility can significantly impact option value, resulting in unexpected losses.
ComplexityFor novice investors, the complexity of options can lead to errors in assessing risks and potential returns.

The option price, or premium, is determined on the exchange and depends on the following key factors:

Underlying asset priceThe higher the current asset price relative to the strike price for call options (and the lower for put options), the higher the premium.
Time to expirationThe more time until the option's expiration date, the higher its value, as there is a greater chance for the asset price to move.
VolatilityThe level of uncertainty or variability in the underlying asset's price. High volatility increases the premium, as it raises the likelihood of significant price movements.
Interest rates and dividendsChanges in interest rates and expected dividends can also affect option values

In the options market, participants trade exchange-listed contracts with different terms and conditions. A contract is defined by its expiration date and strike price. This creates flexibility in choosing strategies and investment timeframes.

Each contract has two sides — the buyer and the seller. A market participant (trader) can take either a long or short position in an option.