Hedging Strategies: Protecting Your Investments with Options Trading Options trading is a powerful tool for investors seeking to manage risk in their stock portfolios. It involves the buying and selling of options contracts, which grant the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specified period. This financial instrument is often used not only for speculative purposes but also as a hedging mechanism to protect a portfolio against adverse market movements. Hedging with options allows investors to safeguard their portfolios from potential losses without having to liquidate their…
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