Calls & Puts with Real-Life Examples
Call Option Example
Suppose Reliance stock is trading at ₹2,500.
You buy a Call Option with strike price ₹2,600, paying a premium of ₹50.
If Reliance goes to ₹2,800, your profit = (2800 - 2600 - 50) = ₹150 per share.
If Reliance stays below 2600, you lose only the premium = ₹50.
A call option = bullish bet (you expect prices to rise).
Put Option Example
NIFTY is at 22,000.
You buy a Put Option strike 21,800, premium ₹80.
If NIFTY falls to 21,200 → Profit = (21800 - 21200 - 80) = ₹520 per lot.
If NIFTY rises above 21,800, you lose only ₹80.
A put option = bearish bet (you expect prices to fall).
Why Traders Use Options
Options are powerful because they allow:
Leverage – Control large value with small money (premium).
Example: Buying Reliance stock directly at ₹2,500 may cost ₹2.5 lakh (100 shares). But buying a call option may cost just ₹5,000.
Hedging – Protect portfolio from losses.
Example: If you hold Infosys shares, you can buy a put option to protect against downside.
Speculation – Bet on market direction with limited risk.
Income generation – Selling options (covered calls, cash-secured puts) generates steady income.
Call Option Example
Suppose Reliance stock is trading at ₹2,500.
You buy a Call Option with strike price ₹2,600, paying a premium of ₹50.
If Reliance goes to ₹2,800, your profit = (2800 - 2600 - 50) = ₹150 per share.
If Reliance stays below 2600, you lose only the premium = ₹50.
A call option = bullish bet (you expect prices to rise).
Put Option Example
NIFTY is at 22,000.
You buy a Put Option strike 21,800, premium ₹80.
If NIFTY falls to 21,200 → Profit = (21800 - 21200 - 80) = ₹520 per lot.
If NIFTY rises above 21,800, you lose only ₹80.
A put option = bearish bet (you expect prices to fall).
Why Traders Use Options
Options are powerful because they allow:
Leverage – Control large value with small money (premium).
Example: Buying Reliance stock directly at ₹2,500 may cost ₹2.5 lakh (100 shares). But buying a call option may cost just ₹5,000.
Hedging – Protect portfolio from losses.
Example: If you hold Infosys shares, you can buy a put option to protect against downside.
Speculation – Bet on market direction with limited risk.
Income generation – Selling options (covered calls, cash-secured puts) generates steady income.
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Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Powiązane publikacje
Wyłączenie odpowiedzialności
Informacje i publikacje przygotowane przez TradingView lub jego użytkowników, prezentowane na tej stronie, nie stanowią rekomendacji ani porad handlowych, inwestycyjnych i finansowych i nie powinny być w ten sposób traktowane ani wykorzystywane. Więcej informacji na ten temat znajdziesz w naszym Regulaminie.