Basic Options Strategies: Rapid Fire

What this video covers

• The four single-option positions (long call, short call, long put, short put) and how to instantly state max gain, max loss, and break-even for each
• Why a covered call is only a partial hedge that caps upside, versus a protective put as the only basic full hedge for long stock
• The unlimited loss danger of a covered put (core short stock position), contrasted with the merely large but capped loss of a covered call
• The foreign currency hedging memory aid: receive foreign currency equals buy puts, pay foreign currency equals buy calls
• Why yield-based options reverse standard logic: long bonds hedged against rising rates use yield-based calls, not puts
• Index option settlement in cash, European-style exercise, and their use for systematic risk only (never unsystematic risk)
• Single-option break-even math: calls always add (strike plus premium), puts always subtract (strike minus premium), shared by both buyer and seller