Long Call - At a Glance

Here is a brief summary about long call strategy.

Strategy

  • Long Call

Alternative Name

  • n/a

Pre-Requisite Strategy Knowledge

  • Long Stock

Legs of Trade

  • 1 leg
  • Buy 1 XYZ call

Sentiment

  • Bullish

Example

  • Long 10 XYZ January 50 calls for $1.25, plus fees and commissions

Rule to Remember

  • n/a

Max Potential Profit (GAIN)

  • Unlimited

Break-Even Point

  • The breakeven point occurs when XYZ stock price is trading equal to the strike price plus the net premium paid.

Max Potential Risk (LOSS)

  • Net Premium Paid (debit)

Ideal Outcome

  • XYZ price rises significantly above the strike price plus net premium paid

Margin Requirement

  • No

Early Assignment Risk

  • Early assignment risk applies to short options positions only.
  • Long options have no risk of early assignment.

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Options trading involves significant risk and is not suitable for all investors as investors may be exposed to potentially rapid and substantial losses. As such you must ensure that you have read and understood our Client Agreement (accessible at www.webull.com.my) and this Risk Disclosure Document including the Characteristics and Risks of Standardized Options available on https://www.theocc.com/company-information/documents-and-archives/options-disclosure-document