Understanding how to profit during a bear market is a key competency for any investor who seeks consistent profits when the trend is bearish. In a declining market, buy-and-hold strategies can underperform, but different approaches like hedging can provide income.
When discussing settlement terms, the other term for cash payment settlement option is often monetary settlement, meaning the no physical asset is delivered.
An comprehensive course on options can equip traders with knowledge such as distinguishing between call and put options. A call gives the ability to acquire an asset at a set price, while a put gives the ability to dispose of it.
In trading terminology, understanding buy to open and buy to close is important. Entering a trade via purchase means initiating exposure, while Purchasing to exit means closing an open short trade.
The popular iron condor technique is an income-generating bid vs ask options play using two spreads combined, aiming to earn premium in a sideways market.
In market orders, bid vs ask reflects the two sides of a quote. The buy bid is what a trader offers to buy, and the ask price is what sellers want.
For options, sell to open vs sell to close is another distinction. Initiating a short by selling means starting exposure by selling, while Selling to exit means exiting a bought position.
Rolling a position is moving a position forward by closing one contract and opening another to adapt to market changes.
A trailing stop is a moving stop order that protects gains by moving with the market. This is not to be confused with a fixed stop, since it adjusts without manual input.
Chart patterns like the M-shaped double top signal a bearish setup after two highs at the same level. Recognizing it can help traders exit early.
Overall, mastering these strategies — from call vs put option to the meaning of trailing stop loss — equips traders to succeed in any market condition.