How do covered puts and cash secured puts work in the world of cryptocurrency?

1 answers

• May 05, 2022 · 3 years ago
  Covered puts and cash secured puts are two options trading strategies that can be used in the world of cryptocurrency. In a covered put, an investor sells a put option and holds a short position in the underlying cryptocurrency. This strategy allows the investor to profit if the price of the cryptocurrency decreases. On the other hand, a cash secured put involves selling a put option and setting aside enough cash to cover the purchase of the underlying cryptocurrency if the option is exercised. This strategy can be used by investors who are bullish on a particular cryptocurrency and are willing to buy it at a lower price. Both strategies can be effective in managing risk and taking advantage of price movements in the cryptocurrency market.
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