In some cases, holders of long OTM options may decide to exercise if very close to the daily settlement underlying price, e.g. These are advanced option strategies and often involve greater risk, and more complex risk, than basic options trades.Įxercise and assignment of options, particularly American-style, may lead to substantial losses especially if a writer of the option is "uncovered." Options that expire in-the- money are subject to automatic exercise, while options that are out-of-the-money are expired. Other Risks: Spreads, Straddles, and other multiple-leg option strategies can entail substantial transaction costs, including multiple commissions, which may impact any potential return. It explains the characteristics and risks of exchange- traded options. Prior to buying or selling an option, investors must read a copy of the Characteristics & Risks of Standardized Options, also known as the options disclosure document (ODD).
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Account types: Traditional brokerage, retirement.
OPTION TRADING PLUS
Fees: Up to 5.133 cents per contract, plus a small regulatory transaction fee for options sales up to 4.915 cents per contract for purchases.
![option trading option trading](https://speedtrader.com/wp-content/uploads/2017/12/Calls-and-Puts-768x768.jpg)
Options trading privileges are subject to Saxo Bank A/S review and approval. Best for Low-Cost Options Trading : Webull. Options involve risks and are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. An option is categorised as a red product as it is considered an investment product with a high complexity and a high risk.ĭanish banks are required to categorise investment products offered to retail clients depending on the product’s complexity and risk as: green, yellow or red.