Part 2 Support and Resistance

Advantages of Option Trading
a. Leverage:

Options allow traders to control large positions with small capital. Buying one option contract often represents 100 shares, meaning traders can gain significant exposure at a fraction of the cost.

b. Flexibility:

Options can be used for speculation, hedging, or income generation.

c. Limited Risk for Buyers:

When you buy options, your maximum loss is limited to the premium paid.

d. Hedging Tool:

Investors can use options to protect their portfolios from downside risk — for instance, buying a put option as insurance against a market fall.