![3 ways an option writer makes money [With Example] - EQSIS](https://i.ytimg.com/vi/mDKEE74FNKs/maxresdefault.jpg "3 ways an option writer makes money [With Example] - EQSIS")
#optionselling #optionwriting #eqsisoptiontraining This video explains the ways by which the option traders makes money by selling (writing) the strike price. The example used in this video can make even a beginner to understand the details of naked selling, covered positions and mispriced option trading. Do not forget to attempt the quiz asked in this video.
Naked selling, covered positions and mispriced option trading are very popular among option traders to make short term money. Every option trader may have different risk appetite, capital and directional expectation.
Naked selling of options to make premium as net gains. It carries the high success ratio and requires aggressive risk management. This includes selling ATM options, OTM option and High IV strikes
Covered position helps the trader to plan their trades along with directional expectations, but they aim for net premium received. It is generally optimized for high returns for the risk taken. It requires moderate capital but less frequent to find good trade opportunity.
Mispriced option trading is an arbitrage trading opportunity. Less frequent but no risk involved. It requires solid understanding. Hope the example and quiz asked in the video make the concepts clear to every viewer.
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