Short Call
You sell (short) a Call
Positions in Chart: Sell 1 lot of 26200 CE. Spot price: 25800
Setup
Sell OTM Call option
When to Use
- Generate income from sideways or declining markets
Market Outlook
Volatility Expectation↘Expected to Fall Sharply
Price Direction↘→Expected to Fall or Stay Flat
Risk & Reward
Breakeven PointStrike Price plus Premium (credit) received
Max Contract LossUnlimited
Max Position LossUnlimited
Strategy Details
Complexity LevelIntermediate
DirectionSteady Bearish
VolatilityFall
Number of Legs1 Leg
Strategy TypeCredit
Hedging CapabilityNo Hedging or Naked
Description
A trader who expects the underlying to remain below a certain level can sell a Call to generate income. The trader receives a credit (premium) for selling the Call
Example
If NIFTY is at ₹25,800 and you sell a ₹26,200 Call for ₹30, you profit if NIFTY stays below ₹26,230 (strike + premium) at expiration.
This information is for educational purposes only and should not be considered as financial advice. Always consult with a qualified financial advisor before making investment decisions. Data is constructed and is not actual. Calculations may have errors.
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