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Topic	Stock Topic 34
red sox 777 12/03/21 1:52:11 PM #391:	Menji posted... This is the kind of thing I want to do. Can help me understand what this is called so I know what to select? Is this the one where you're either going to get shares at low price if the price goes up or overpay if the price stays down? So it's fine as long as you're okay with owning more shares? It's also a way to get leverage without actually taking on margin. You can get the upside for the same number of shares with a small fraction of the capital invested. The downside is the risk of the money you put in has a pretty high chance of going to zero. But since it's a much smaller amount of money, the risk in some sense is lower. Unless you do the WSB strategy of deciding that you can buy calls representing vastly vastly more shares than you could possibly afford to exercise. Which you can do if you want the riches or bust risk profile. --- September 1, 2003; November 4, 2007; September 2, 2013 Congratulations to DP Oblivion in the Guru Contest! <cite>red sox 777 posted [p:960587958] in Stock Topi... [t:79729468]...</cite> <quote>Menji posted... </cite> <quote>This is the kind of thing I want to do. Can help me understand what this is called so I know what to select? Is this the one where you're either going to get shares at low price if the price goes up or overpay if the price stays down? So it's fine as long as you're okay with owning more shares?</quote> It's also a way to get leverage without actually taking on margin. You can get the upside for the same number of shares with a small fraction of the capital invested. The downside is the risk of the money you put in has a pretty high chance of going to zero. But since it's a much smaller amount of money, the risk in some sense is lower. Unless you do the WSB strategy of deciding that you can buy calls representing vastly vastly more shares than you could possibly afford to exercise. Which you can do if you want the riches or bust risk profile. --- September 1, 2003; November 4, 2007; September 2, 2013 Congratulations to DP Oblivion in the Guru Contest!</quote> ... Copied to Clipboard!
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