Question

Select an underlying security (that is not an ETF) (USA)
– Choose whether you are bullish, bearish or both on this equity and explain why
– Tell us which option strategy you are going to execute and why (i.e., provide your
analysis)
– Ensure that the option strategy is truly based on real market values
– capture an image to confirm

Answer 1

I will try to explain it from an Indian Stock market point of view:

Let's say I take IOCL ( Indian Oil Corporation limited)

Presently it is hovering at 170-172 range, if we see the fundamentals , QoQ it was 29% down in net income as compared to last quarter , but yearly results shows that it is 10.5% up. (Source Moneycontrol.com, type IOCL and see the financials , P&L quarterly and yearly)

So, my take fundamentals are strong, profitability has increased and it is the most profitable among all the oil refineries, naturally I am bullish on the take.and think the stock to move up.

As per execution of option strategy is concerned,i can have a call option to buy at 170 levels( planning to invest now) , in case the stock goes up and touches 200.

Else if i already have it in my portfolio, then i might buy a put option to sell it 170+ in order to avoid loss.