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All-StarsBearish to Neutral
Short Call
Overview
Selling a call option without owning the underlying stock (naked). You collect premium hoping the stock stays below the strike. This is one of the riskiest options strategies due to theoretically unlimited upside risk.
Max Profit
Limited to: Premium received
Max Loss
Unlimited (theoretically infinite as stock can rise infinitely)
Breakeven
Strike Price + Premium received
Structure
Short 1 Call (naked/uncovered)
Risk Profile
Limited profit (premium). Unlimited risk. Highest risk options strategy.
When to Use
Only for experienced traders. When you're strongly bearish or neutral. When IV is very high and you want to sell expensive premium. Requires significant margin and risk tolerance.