Options...Lets talk about risk managment
Options are a tricky subject to learn. There are many technical terms to understand like the Greeks, contract size and more.
Today I wanted to illustrate a few examples of option calls (bullish bias) on NASDAQ:BRLT
Using a website called, optionprofitcalculator.com I can simulate my idea by specifying the strike price, date of expiration as well as entry price.
What you will get is a chart outlying different profit curves and what you would expect to see when exercised. I took the time to draw trendlines outlining the minimum the price would need to be by set a date to breakeven throughout the life of the option.
What I noticed is that not all options are created equally as we know. But, I never had such a visual as just how different they were. Observe each line, I provided projection for a few points of reference to compare.
Percentage at expiration (set at $6 expiration for comparison), the expiration date and breakeven projection line.
This little experiment is a simple example research first is important. Look First then Leap.
Cheers,
Uni.
