14 Collateral and Tax Rules for Options Trading

The strategies used to set up hedges involve a rich variety of option-based positions. These are not necessarily complicated, and can be put into action assuming a few basic requirements:

1. You understand option rules and risks. The first rule for options (and all types of investments) is that you know the trading rules and the risks involved. When you first look at the terminology and variety of options, the whole idea seems exotic and risky. And in fact, if you do not first master the basics, you should not use options, either as a conservative ...

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