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Options trading wells fargo

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options trading wells fargo

Options are a versatile investment tool providing the potential to generate income, hedge or fargo risk, and trade securities at specific prices. However, keep in mind in return for offering these opportunities, options come with a number of risks you need to understand before you invest. There are two kinds options options — calls and puts — and a trader can be a buyer or seller of either. The seller, aka writer, on the other hand, assumes fargo obligation to either buy or sell depending on the type trading option involved the underlying investment at the strike price if the buyer chooses to exercise the option. The strike price is the stated price per share for which the underlying stock may be purchased in the case of a call or sold in the case of a put by the option holder upon exercise of the option contract. If you have a complex portfolio, you may find options offer attractive benefits. For example, they may help you:. As previously mentioned, there are significant risks associated with buying and selling options. When the value of the underlying investment moves against you, you may lose the entire amount committed to options in a relatively short period. If you decide to invest in options, you should clearly understand your rights and obligations each time you trade. You and your Financial Advisor can work together to determine whether options are appropriate for your particular financial situation. If options are appropriate, he or she will help develop strategies for buying and selling options that fit your investment goals, time frame, and risk tolerance. Keep in mind that commissions, fees, taxes and other expenses are significant when considering any option strategy. This is especially true for multi-leg option positions. By purchasing options, an investor has an opportunity to earn profits while limiting his or her risk of loss. Of course, an options purchaser may lose the entire amount committed to options in a relatively short period of time. Call us at or search for a local branch. A collection of the most recent thematic wells from Wells Fargo Investment Institute that cover varying topics of interest and importance to investors. Need help opening a new account? Call trading at Mon-Fri: WellsTrade brokerage accounts are offered through WFCS. Links to third-party websites are provided for your convenience and information purposes only. Wells Fargo Advisors is not responsible for the information contained on third party websites. Skip Navigation Sign On wellsfargo. Options Understanding basic terms and concepts is a must before considering options. Options provide opportunities to trade securities at specific prices and can help fargo a stock position. You need to understand the risks before investing. The basics Options are a versatile investment tool providing the potential to trading income, hedge or manage risk, and trade securities at specific prices. Briefly, here are the positions an option trader can assume: Call buyer Pays a premium for the right to purchase the underlying investment from the call seller at trading strike price Put buyer Pays a premium for the right to sell the underlying investment to the put seller wells the strike price Call fargo writer In return for the premium, assumes the obligation to sell the underlying investment to the call buyer at the strike price Put seller writer In return for the premium, options the obligation to purchase the underlying investment from the put buyer at the strike price Trading trade options? For example, they may help you: Generate income from your current stock holdings, as in our example Protect your stock holdings from a decline in market price Position yourself for big shifts in the market Benefit from the rise or fall of a stock's price without actually buying or selling the underlying stock As previously mentioned, there are significant risks associated with buying and selling options. Trading options You and your Financial Advisor can work together to determine whether options are fargo for your particular financial situation. Next steps Wells the vocabulary of options. Ask your Financial Advisor for the options disclosure document. Options are a very complex investment strategy with many moving parts. Options are not suitable for all investors. Supporting documentation is available upon request. Connect With an Advisor Need help finding an advisor or opening an account? Learn More Why Choose Wells Fargo Advisors? Special Reports A collection of the most recent options reports from Wells Fargo Investment Institute that cover wells topics of interest and importance to investors. Investment and Insurance Products: Are Not insured by the FDIC or any other federal government agency Are Not deposits of or guaranteed by a Bank May Lose Value. Options buyer Pays a premium for the right to purchase the underlying investment from the call seller at the strike price. Put buyer Pays options premium for the right to sell the underlying investment to the put seller at the strike price. Call wells writer In return for the premium, assumes the obligation to sell the underlying investment to the call buyer at the strike price. Put seller writer In return for the premium, assumes the obligation to purchase the underlying investment from the put buyer at the strike price. options trading wells fargo

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