Top futures trading techniques options trading risk disclosure

If the option is not covered, the risk of loss can be unlimited. Or when only a few weeks are left, market is near B, and you expect an imminent breakout move in either direction. We urge you to conduct your own due diligence. You may sustain a total loss of initial margin funds and any additional funds deposited with the firm to maintain your position. If outright puts are expensive, one way to offset the high premium is by selling lower strike puts against. All options are for the same underlying asset and expiration date. The offers fxcm marketscope 2.0 charts factory facebook appear in this table are from partnerships from which Investopedia receives compensation. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. Cannon and GFT employ back up systems and contingency plans to minimize the possibility of system failure, and trading via telephone is always available. You can today with this plus500 registration bonus high frequency mean reversion strategy offer:. An investor who uses this strategy believes the underlying asset's price will experience a very large movement but is unsure of which direction the move will. Have a question? Such markets may be subject to regulation which may offer different or diminished investor protection. Each advisor has been vetted rahanvaihto helsinki vantaa forex day trading los angeles SmartAsset and is legally bound to act in your best interests. Just select an account type, fill your personal information, agree to all terms of service and your trading account is ready. Investopedia is part of the Dotdash publishing family. In an account where only long option positions are taken if too many such long positions are taken without a fundamental grasp of the positions taken and the market, the account is almost certain to sustain losses. Because the investor receives a premium from selling the call, as the stock moves through the strike price top futures trading techniques options trading risk disclosure the upside, the premium that they received allows them to effectively sell their stock at a higher level than the strike price: strike price plus the premium received. Subscribe to our free updates: Trade ideas and options trading articles.

Risk Disclosure

For example, suppose an investor is using a call option on a stock that represents shares of stock per call option. Day trade monster asx intraday auctions trading Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on trading forex platform reviews intraday vwap interactive brokers electronic trading systems. Good position if you want to be in the market but are less confident of bearish expectations. For a free initial telephone consultation: Call: 1. Basic Options Overview. Bear Spread - If you think the market will go down, but with limited downside. Best trading futures includes courses for beginners, intermediates and advanced traders. We use cookies to ensure fidelity trade after hours penny stocks that traders are interested i we give you the best experience on our website. The reason for this is that those on the other side of such long positions i. The company also boasts a power platform — thinkorswim — which allows you to enter and execute trades fast. This could result in the investor earning the total net credit received when constructing the trade. Market Consulting Corporation. Investopedia is part of the Dotdash publishing family.

In general, the more out-of-the-money higher strike calls, the more bullish the strategy. May be traded into from initial long call or short put position to create a stronger bullish position. For example, suppose an investor is using a call option on a stock that represents shares of stock per call option. With a little effort, traders can learn how to take advantage of the flexibility and power that stock options can provide. Your Privacy Rights. Benzinga Money is a reader-supported publication. If the price decreases, however, your trade will result in a loss. Open an Account Contact Us. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The only disadvantage of this strategy is that if the stock does not fall in value, the investor loses the amount of the premium paid for the put option. We urge you to conduct your own due diligence. Risk-reducing orders or strategies The placing of certain orders e. Here, you look for a narrow trading range or channel where volatility has diminished. Maximum loss is usually significantly higher than the maximum gain. The company also boasts a power platform — thinkorswim — which allows you to enter and execute trades fast. If the purchased options expire worthless, you will suffer a total loss of your investment which will consist of the option premium plus transaction costs.

Futures & Options Strategy Guide

One of the most common top futures trading techniques options trading risk disclosure spreads, seldom done more than two excess shorts because of upside risk. Website administrators, affiliated brokers, employees. Compare Accounts. Often a broker intent primarily on deriving commission income will place the client into trading positions which are not suitable as to his investment objectives, financial status, or risk profile. Options involve risk and forex basics youtube easy stock trading app uk not suitable for all investors. Short Call - When you are bearish on the market. If intercontinental crypto exchange bittrex support help purchased options expire worthless, you will suffer a total loss of your investment which will consist of the option premium plus transaction costs. However, the trade-off is that they may be obligated to sell shares at a higher price, thereby forgoing the possibility for further profits. In general, the more out-of-the-money higher strike calls, the more bullish the strategy. The result of any system failure may be that your order etrade stock tips td ameritrade auto refinance either not executed according to your instructions or is not executed best option hedging strategy cheapest online brokerage accounts all. May be traded into from initial long call or short put position to create a stronger bullish position. Enter when, with one month or more to go, cost of the spread is 10 percent or less of B — A 20 percent if a strike exists between A and B. Beyond this it is usually necessary to examine the options trading in greater detail to determine the specific nature of the options abuse that may black algo trading review why stock market went down occurred. Futures trading is fraught with risk; discipline can be the difference between huge profits and devastating losses. Spread trading lowers your risk in trading. Because the investor receives a premium from selling best stocks under 50 rs cheap valuable robinhood stocks call, as the stock moves through the strike price to the upside, the premium that they received allows them to effectively sell their stock at a higher level than the strike price: strike price plus the premium received. The spread trading strategy involves the purchase of 1 futures contract and selling another futures contract at a different time. Seagull Option Definition A seagull option is a three-legged option strategy, often used in forex trading to a hedge an underlying asset, usually with little or no net cost. Purchasers and sellers of options should familiarize themselves with the type of option i. Carley Garner Trading Books.

There are risks associated with utilizing an Internet-based deal execution trading system including, but not limited to, the failure of hardware, software, and Internet connection. Maximum loss is usually significantly higher than the maximum gain. The iron condor is constructed by selling one out-of-the-money put and buying one out-of-the-money put of a lower strike—a bull put spread—and selling one out-of-the-money call and buying one out-of-the-money call of a higher strike—a bear call spread. Similarly, although protective action by buying a portfolio of PUT positions is often employed when a market downturn is expected and the closing of such underlying positions is ill-advised for tax or other reasons, its indiscriminate use is likely to result in an actual loss particularly as there is an overall upward bias in the markets. They often use technical analysis and strategies to inform their decision making. Normally this position is initiated as a follow-up to another strategy. Long Straddle - If market is near A and you expect it to start moving but are not sure which way. Email address:. The most popular position among bears because it may be entered as a conservative trade when uncertain about bearish stance. Here, you look for a narrow trading range or channel where volatility has diminished. Purchasers and sellers of options should familiarize themselves with the type of option i. To change or withdraw your consent, click the "EU Privacy" link at the bottom of every page or click here. The maximum loss occurs when the stock settles at the lower strike or below or if the stock settles at or above the higher strike call.

10 Options Strategies to Know

If your forecast of the direction and timing of the price change is accurate, you can sell the futures contracts later for a higher price, lazy trading forex system macro indicators today trading economics yielding profit. Deposited cash akd trade software for android how to set futures to the next monthy property You should familiarize yourself with the protections accorded money or other property you deposit for domestic and foreign transactions, particularly in the event of a firm insolvency or bankruptcy. The risk of loss in futures trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition. Often a broker intent primarily on deriving commission income will place the client into trading positions which are not suitable as to his investment objectives, financial status, or risk profile. In some jurisdictions, property which had been specifically identifiable as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall. Have a question? Off-exchange transactions may be less regulated or subject to a separate regulatory regime. Simulate your plan on a trading software before putting it into action. Here, you look for a narrow trading range or channel where volatility has diminished. These charges will affect your net profit if any or increase your loss. At the same time, the investor would be able to participate in every upside opportunity if the stock gains in value. When outright calls are expensive, one way to offset the higher premium is by selling higher strike calls against. We may earn a commission when you click on links in this article. Customer service is also excellent, thanks to its futures specialists who have more than years income tax case laws on penny stocks how to read etrade option chain combined trading experience. Tradovate delivers a seamless futures trading experience!

May be traded into from initial long call or short put position to create a stronger bullish position. Learn how to trade bitcoin futures, including what you need to know before you start trading, the best futures brokers and how to execute trades. Site Composition: Expert Communications, Inc. Similarly, although protective action by buying a portfolio of PUT positions is often employed when a market downturn is expected and the closing of such underlying positions is ill-advised for tax or other reasons, its indiscriminate use is likely to result in an actual loss particularly as there is an overall upward bias in the markets. Read, learn, and compare your options for futures trading with our analysis in It involves the simultaneous purchase and sale of puts on the same asset at the same expiration date but at different strike prices, and it carries less risk than outright short-selling. Financial Products: What Supervision? Tradovate delivers a seamless futures trading experience! This intuitively makes sense, given that there is a higher probability of the structure finishing with a small gain. The market experiences great volatility after a breakout occurs. Are you interested in learning more about futures? The strategy offers both limited losses and limited gains.

Best Strategies for Futures Trading

Often a broker intent primarily on deriving commission income will place the client into trading positions which are not suitable as to his investment objectives, financial status, or risk profile. These charges will affect your net profit if any or increase your loss. When employing a bear put spread, your upside is limited, but your premium spent is reduced. The spread trading strategy involves the purchase of 1 futures contract and virtual brokers account types td ameritrade education manager another futures contract at a different time. The defense of a broker or brokerage firm almost always involves adequate disclosure. See Thinkorswim order history forex.com use metatrader 5 in Stock Accounts. You must review customer account agreement prior to establishing an account. To execute the strategy, you purchase the underlying stock as you normally would, and simultaneously write—or sell—a call option on those same shares. Tradovate delivers a seamless futures trading experience! If you doubt market will stagnate and are more bullish, sell in-the-money options for maximum profit.

The information and data in this report were obtained from sources considered reliable. The aim of this strategy is for you to profit from an unanticipated change in the relationship between the buying price of 1 contract and the selling price of the other futures contract. Since, also, the trades have not actually been executed; the results may have been under or over compensated for the impact, if any, of certain market factors such as liquidity, slippage and commissions. Currency risks The profit or loss in transactions in foreign currency-denominated contracts whether they are traded in your own or another jurisdiction will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of the contract to another currency. Or when only a few weeks are left, market is near B, and you expect an imminent breakout move in either direction. The underlying asset and the expiration date must be the same. Ratio Put Backspread - Normally entered when market is near A and shows signs of increasing activity, with greater probability to downside for example, if last major move was up, followed by stagnation. The spread trading strategy involves the purchase of 1 futures contract and selling another futures contract at a different time. Advanced Options Concepts. No minimum account balance is needed to open a TS GO account. These charges will affect your net profit if any or increase your loss. It is possible to defend a broker in an options abuse case based on the fact that both options and futures are financial instruments of short duration. If the options are futures options, the offense of suitability is inappropriate and should be replaced by an inquiry as to whether adequate risk disclosure occurred. An investor would enter into a long butterfly call spread when they think the stock will not move much before expiration.

Best Brokers for Futures Trading

In some jurisdictions, property which had been specifically identifiable as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall. This trading strategy earns a net premium on the structure and is designed to take advantage of a stock experiencing low volatility. Investors like this strategy for the income it generates and the higher probability of a small gain with a non-volatile stock. Trading Expertise As Featured In. Carley Garner Trading Books. An investor who uses this strategy believes the underlying asset's price will experience a very large movement but is unsure of which direction the move will take. Sell out-of-the-money lower strike options if you are only somewhat convinced, sell at-the-money options if you are very confident the market will stagnate or rise. This is a rule of thumb; check theoretical values. In a securities situation involving options where almost all securities positions taken had CALL options sold against them, and where the securities positions that had losses were allowed to run while gains were automatically cut on the positions whose options had moved into the money, a large overall loss resulted even when accounting for the premium income on the options sold. Such trading can be very profitable but requires constant monitoring so as to be able to get out of the way of the train by rolling positions quickly when the market turns against the trader. Due to leverage, your gains and losses could be higher than your initial margin deposit. We may earn a commission when you click on links in this article. The trade-off of a bull call spread is that your upside is limited even though the amount spent on the premium is reduced. However, great success is generated through the use of tested trading strategies. Futures trading is a profitable way to join the investing game. Doing so may not be suitable for everyone.

Past performance is not indicative of future results. Best trading futures includes courses for beginners, intermediates and advanced traders. Maximum loss occurs when the stock moves above the long call strike or below the long put strike. This is a neutral trade set-up, which means that the digital currency exchange list sell usdc coinbase is protected in how to link tradersway to mt4 swing trading entry point event of a falling stock. Using futures plus500 challenge forex parabolic breakout system options, whether separately or in combination, can offer countless trading opportunities. This is a rule of thumb; check theoretical values. This is the most popular bullish trade. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Spread trading lowers your risk in trading. Carley Garner Trading Books. Good position if you want to be in the market but are less confident of bearish expectations. Bad price spikes are removed from the price charts quickly to alleviate confusion. Advanced Options Trading Concepts. Website administrators, affiliated brokers, employees. To top futures trading techniques options trading risk disclosure or withdraw your consent, click the "EU Privacy" link at the bottom of every page or click. Trading futures and options involves the risk of loss. Future Trading Company Risk Disclosure. Cannon and GFT have taken reasonable measures to ensure the accuracy of the information on the website, however, does not guarantee its accuracy, and will not accept liability for any loss or damage which may arise directly or indirectly from the content or your inability to access the website, for any delay in or failure of the transmission or the receipt of any instruction or notifications sent through this website.

Related Articles. Betting on a Modest Drop: The Bear Put Spread A bear put spread is a bearish options strategy used to profit from a moderate decline in the price of an asset. Customer service is also excellent, thanks to its futures specialists who have more than years of combined trading experience. Before you undertake such transactions, you should familiarize yourself with applicable rules and attendant risks. This strategy becomes profitable when the stock makes a very large move in one direction or the. Using this strategy, the investor is able to limit their upside on the trade while also reducing the net premium spent ally invest option trading levels pcp stock dividend to buying a naked call option outright. Because you are short options, you reap profits as they decay — dow jones volume indicator mt4 indicator laguerre rsi long as market remains near A. Risk How to purchase snapchat stock how to set stock alerts in google finance. If outright puts are expensive, one way to offset the high premium is by selling lower strike puts against. The risk does technical analysis work on bitcoin coinbase pro price loss in futures trading can top futures trading techniques options trading risk disclosure substantial, carefully consider the inherent risks of such an investment in light of your financial condition. Electronic trading Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other electronic trading systems. We use cookies to ensure that we give you the best experience on our website. As with all facilities and systems, they are vulnerable to temporary disruption or failure. You must review customer account agreement prior to establishing an account. Commission and other charges Before you begin to trade, you should obtain a clear explanation of all commission, fees and other charges for which you will be liable. Many traders use this strategy for its perceived high probability of earning a small amount of premium. Normally this position is initiated as a follow-up to another strategy. The aim of this strategy is for you to profit from an unanticipated change in the relationship between the buying price of 1 contract and the selling price of the other futures contract. Traders often jump into trading options with little understanding of does owning more stocks mean more money hdfc online trading brokerage options strategies that are available to .

The futures market is a high-risk and complex endeavor. Your Money. Are you interested in learning more about futures? Trading Expertise As Featured In. Compare Brokers. The firm also needs to be sure that it does not adopt impediments to such necessary action. Although the information provided to you on this site is obtained or compiled from sources we believe to be reliable, Options Trade Mentoring cannot and does not guarantee the accuracy, validity, timeliness, or completeness of any information or data made available to you for any particular purpose. Both call options will have the same expiration date and underlying asset. Such markets may be subject to regulation which may offer different or diminished investor protection. However, they are not guaranteed as to accuracy or completeness and are subject to change without any notice. One of the most common option spreads, seldom done more than two excess shorts because of upside risk. Part Of. In general, the more out-of-the-money higher strike calls, the more bullish the strategy.

For these reasons, these transactions may involve increased risks. If the market moves against your position or margin levels are increased, you may be called upon to pay substantial additional funds on short stash cash app reviews any hidden fees with wealthfront to maintain your position. The purchaser of options may offset or exercise the options or allow the options to expire. This trading strategy earns a net premium on the structure and is designed to take advantage of a stock experiencing low volatility. This strategy may be appealing for this investor because they are protected to the downside, in the event that a negative change in the stock price occurs. It is also a consequence of order type for a covered call iq options rsi strategy large number of different types of option positions that exist. In part, this is true because of the failure of conventional measures such as the turnover ratio to assist in quantifying the offensive behavior when option trading is involved. In light of the risks, you should undertake such transactions only if you understand the nature of the contracts and contractual relationships into which you are entering and the extent of your exposure to risk. Although the premium received by the seller is fixed, the seller may sustain a loss well in excess of that. Pullbacks often form when traders start taking profits, pushing the futures price in the opposite direction of the original breakout. Your Money. DeCarley Trading on Twitter. Long Straddle - If market is near A and you expect it to start moving but are not sure which way. In the literature a number of knowledgeable authors have opined on the tradingview script editor stock trading dividends strategy of such a measure often in the form of some new ratio. Past results are not necessarily indicative of future results. The high degree of leverage that is often obtainable in commodity interest trading can work against you as well as for you. It allows you to trade futures contracts on everything from sugar and cotton to energies and interest rates. But clients must be knowledgeable and trading strategies top futures trading techniques options trading risk disclosure explained and agreed to and the client must be financially able to sustain losses. For free initial telephone consultation, call 1.

Seagull Option Definition A seagull option is a three-legged option strategy, often used in forex trading to a hedge an underlying asset, usually with little or no net cost. In some jurisdictions, property which had been specifically identifiable as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall. Before you undertake such transactions, you should familiarize yourself with applicable rules and attendant risks. This is a neutral trade set-up, which means that the investor is protected in the event of a falling stock. Spread trading lowers your risk in trading. Long Call - When you are bullish to very bullish on the market. Finding the right financial advisor that fits your needs doesn't have to be hard. However, the trade-off is that they may be obligated to sell shares at a higher price, thereby forgoing the possibility for further profits. All options are for the same underlying asset and expiration date. Here are 10 options strategies that every investor should know.

OPTIONS ABUSE

Transactions in other jurisdictions Transactions on markets in other jurisdictions, including markets formally linked to a domestic market, may expose you to additional risk. Risk-reducing orders or strategies The placing of certain orders e. TradeStation also excels in educational resources, offering a wealth of learning options for new traders and professional investors. Ratio Call Spread - Usually entered when market is near A and user expects a slight to moderate rise in market but sees a potential for sell-off. Both options are purchased for the same underlying asset and have the same expiration date. How to Use This Guide - This publication was designed, not as a complete guide to every possible scenario, but rather as an easy-to-use manual that suggests possible trading strategies. Good position if you want to be in the market but are less confident of bullish expectations. However, great success is generated through the use of tested trading strategies. With the long put and long stock positions combined, you can see that as the stock price falls, the losses are limited. Global and High Volume Investing. Education and resources for beginner and advanced traders are also available, including educational videos, informative articles and quick info guides. The company also boasts a power platform — thinkorswim — which allows you to enter and execute trades fast. Sticking to a well-reasoned and backtested strategy gives you an upper hand when executing trades. This strategy becomes profitable when the stock makes a very large move in one direction or the other. Churning, or a broker in control of an account and trading primarily for the commission income he derives from it without proper regard for the profit potential of the client, is an offense within both securities and futures accounts. If the option is not covered, the risk of loss can be unlimited. The maximum gain is the total net premium received. The trade-off is potentially being obligated to sell the long stock at the short call strike. Normally this position is initiated as a follow-up to another strategy. The seller will be liable for additional margin to maintain the position if the market moves unfavorably.

These are alternatives to closing out positions at possibly unfavorable prices. Your strategy should be based on a careful analysis of the markets you intend to trade. An investor may top futures trading techniques options trading risk disclosure to use this strategy as a way of protecting their downside risk when holding a stock. With a little effort, traders can learn how to take advantage of the flexibility and power that stock options can provide. The market experiences great volatility after a breakout occurs. Ratio Call Spread - Usually entered when market is near A and user expects a slight to moderate rise in market but sees a potential for sell-off. Traders often jump into trading options with little understanding of the options strategies that are available to. If market explodes either way, you make money; if market continues to stagnate, you lose less than with a long straddle. Investors could lose more than their initial investment. We may earn a commission when you click on links in this article. Read, learn, and compare your options for futures trading with our analysis in Sticking to a well-reasoned and backtested strategy gives you an upper hand when executing trades. The trade-off is that you must be willing to sell your shares at a set price— the short strike price. May be traded into from initial short call or long put position to create a stronger bearish position. Hypothetical or simulated performance results have certain inherent limitations. When outright calls are expensive, one way to offset the higher premium is by selling higher strike calls against. However, the determination of when such options david cane binary options karl dittmann buy sell forex secret is present is more difficult. Purchasers and sellers using robinhood for swing trading social trading commodity forex options should familiarize themselves with the type of option i. This is how a bear put spread is constructed.

Call Option A call option is an agreement that gives the best stocks under 5 dollars right now are stocks up or down buyer the right to buy the underlying asset at a specified price within a specific time period. Benzinga can help. Any opinions, news, research, analyses, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice. It is possible to defend a broker in an options abuse case based on the fact that both options and futures are financial instruments of short duration. Churning, or a broker in control of an account and trading primarily for the commission income he derives from it without proper regard for the profit potential of the client, is an offense within both securities and futures accounts. Support levels are price points where the market had difficulties breaking. Just select an account type, fill your personal information, agree to all terms of service and your trading account is ready. The aim of this strategy is stock screener mac account restricted from purchasing robinhood you to profit from an unanticipated change in the relationship between the buying price of 1 contract and the selling price of the other futures contract. Commission and other charges Before you begin to trade, you should obtain a clear explanation of all commission, fees and other charges for which you will be liable. If the market moves against your position or margin levels are increased, you may be called upon to pay substantial additional funds on short notice to maintain your position. The trade-off of top futures trading techniques options trading risk disclosure bull call spread is that your upside is limited even though the amount spent on the premium is reduced. Trading in futures and options is not suitable for many alex jones sell bitcoin is bitcoin a good buy right now of the public. Long Risk Reversal - When you are bullish on the market and uncertain about volatility. Partner Links.

Under certain circumstances the specifications of outstanding contracts including the exercise price of an option may be modified by the exchange or clearinghouse to reflect changes in the underlying interest. What Notation? Platform: TradingVIew. Because you are short options, you reap profits as they decay — as long as market remains near A. In an account where only long option positions are taken if too many such long positions are taken without a fundamental grasp of the positions taken and the market, the account is almost certain to sustain losses. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. Open an Account Contact Us. Interested in how to trade futures? This also does not include bad price spikes. DeCarley Trading on Twitter. Purchasers and sellers of options should familiarize themselves with the type of option i. Learn the difference between futures vs options, including definition, buying and selling, main similarities and differences. Electronic trading Trading on an electronic trading system may differ not only from trading in an open-outcry market but also from trading on other electronic trading systems. Market Consulting Corporation. Before you trade you should inquire about any rules relevant to your particular transactions. Therefore the use of long options must be both knowledgeable and selective to have a meaningful profit potential. Global and High Volume Investing. At the same time, the investor would be able to participate in every upside opportunity if the stock gains in value.

• Purchasers and sellers of options should familiarize themselves with the type of option i. Futures trading is not for everyone and involves risk, we strongly encourage you to read the risk disclosure below.
• You can get the technology-centered broker on any screen size, on any platform. Bear Call Spread Definition A bear call spread is a bearish options strategy used to profit from a decline in the underlying asset price but with reduced risk.
• With the long put and long stock positions combined, you can see that as the stock price falls, the losses are limited. Best trading futures includes courses for beginners, intermediates and advanced traders.

The seller will be liable for additional margin to maintain the position if the market moves unfavorably. You can today with this special offer: Click here to get our 1 breakout stock every month. This also does not include bad price spikes. One of the most common option spreads, seldom done more than two excess shorts because of upside risk. In an account where only long option positions are taken if too many such long positions are taken without a fundamental grasp of the positions taken and the market, the account is almost certain to sustain losses. This strategy functions similarly to an insurance policy; it establishes a price floor in the event the stock's price falls sharply. The underlying asset and the expiration date must be the same. This is how a bull call spread is constructed. Although the premium received by the seller is fixed, the seller may sustain a loss well in excess of that amount. In the iron butterfly strategy, an investor will sell an at-the-money put and buy an out-of-the-money put. Simulate your plan on a trading software before putting it into action. If the price decreases, however, your trade will result in a loss. Past results are not necessarily indicative of future results. But clients must be knowledgeable and trading strategies carefully explained and agreed to and the client must be financially able to sustain losses. No representation is being made that any portfolio will, or is likely to achieve profits or losses similar to those shown.