The choice to buy or sell depends on whether you are (expecting prices to rise), bearish (expecting prices to fall), or neutral . Strategy Name Market Outlook Risk / Reward Profile Buy Call Limited loss (premium paid); unlimited profit . Sell Call Short Call Bearish / Neutral

(premium paid); high profit if stock falls to zero. Sell Put Bullish / Neutral

: This is the price paid by the buyer to the seller (writer) for the rights granted by the option.

: Standard equity options typically control 100 shares of the underlying stock. The Four Basic Moves

(premium received); high loss if stock falls. Basic Call and Put Options Strategies | Charles Schwab

(premium received); unlimited loss if stock rises. Buy Put

The four basic moves in options trading—buying calls, selling calls, buying puts, and selling puts—each represent a different market outlook and risk profile. Core Concepts of Calls and Puts

: Gives the buyer the right to sell a stock at a set strike price before a specific expiration date.