In extremely simple terms, OP must predict how high the stock will go before a specific date. If OP is correct then massive gains as you see here. If OP is wrong then the $8k literally becomes $0. There certain things you can do before expiration dates to minimize loss or take less gains early
Every option is for 100 shares. So you're only paying for the premium when you buy a call/put. That means you can buy 100,000 shares in some cases with only a few thousand dollars. But you would never be able to buy 100k shares right out most likely. Thats why you do the option and try to time it so you basically never really owned the share, just the profit/loss. In these cases you only lose the premium, thats why someone mentioned this guy probably lost 300k doing weekly bets on GME until he finally hit big.
You can hit huge gains, but theres a high chance youre just going to lose your premiums. Its a casino bruh. If you want big gains then options are a good way to do it with less capital.
Im retarded though so take this all with a grain of salt. Ive only lost a few thousand so far in calls/puts.
Only if you decide to SELL calls/puts. That means you’re the guy supplying these bets. The buyer is only on the hook for the premium but if you’re the supplier/seller then your losses are theoretically infinite.
Yeah with shares you'll literally lever lose everything unless you throw all your eggs into a ship that goes bankrupt. If you do nothing but play options you can lose everything. Sometimes even more than everything. I love me some SPY calls tho
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u/Guilty-Message-5661 19d ago
In extremely simple terms, OP must predict how high the stock will go before a specific date. If OP is correct then massive gains as you see here. If OP is wrong then the $8k literally becomes $0. There certain things you can do before expiration dates to minimize loss or take less gains early