How does covered call assignment work in the world of cryptocurrency?

1 answers

• Nov 24, 2021 · 3 years ago
  In the world of cryptocurrency, covered call assignment is a popular strategy used by investors to generate income and manage risk. It involves selling call options on a cryptocurrency that the investor already owns. When the call option is exercised, the investor is obligated to sell the cryptocurrency at the agreed-upon price. This strategy allows investors to earn premium income from selling the call options, while also potentially profiting from the increase in the price of the cryptocurrency. However, it's important to note that covered call assignment in cryptocurrency comes with its own set of risks, including the potential for significant price volatility and the possibility of missing out on potential gains if the price of the cryptocurrency rises sharply.
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