What are the potential outcomes if I purchase a put option on a virtual currency?
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If I decide to purchase a put option on a virtual currency, what are the potential outcomes that I should be aware of? How does buying a put option on a virtual currency work and what are the risks involved?
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1 answers
- When you purchase a put option on a virtual currency, you are essentially betting that the price of the currency will decrease. If the price does indeed drop below the strike price, you can exercise the option and sell the currency at a profit. However, if the price remains above the strike price or increases, the put option may expire worthless and you would lose the premium paid for the option. It's important to note that buying put options on virtual currencies can be a speculative investment strategy and carries inherent risks. It's advisable to consult with a financial advisor or do thorough research before making any investment decisions.
Dec 18, 2021 · 3 years ago
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