Options

Learn about options trading, from how to place your first options trade to more advanced topics.

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Portfolio Management

Using S&P 500 Put Options to Hedge a Downturn

Using S&P 500 put options for temporary downside portfolio protection when concerns over an event-driven sell-off are elevated.

Trading

Weekly Trader's Outlook

The S&P 500 and Nasdaq Composite opened at all-time highs yesterday but have reversed sharply following this morning's weak Nonfarm Payrolls report and higher tariff impositions.

Options

Comparing Index Options and Equity Options

Index options are typically used to hedge and speculate on broad swaths of the market, while single equity options track much narrower underlying assets. Both can have a place in a trader's toolkit.

Options

Understanding the Gamma Squeeze

A gamma squeeze occurs through a combination of retail call buying, a rally in the stock, and market makers buying stock to hedge exposure, forcing the stock price up.

Options

Options Strategy Spotlight: Long Call vs. Bull Call Spread

With so many bullish options strategies to choose from, how do you know which is right for your next trade? We'll compare two bullish options strategies in order to assist you with the decision-making process.

Options

Three Things to Know About the Wheel Strategy

The options wheel strategy involves selling cash-secured puts, and if they're assigned, writing covered calls on the stock, which might be repeatable. Here are three things to know.

Order Types

How to Use Walk Limit Orders for Options Trading

Schwab's proprietary Walk Limit orders for options automate the process of placing limit orders, increasing or decreasing the price for traders along the bid/ask spread.

Trading Tools

Analyze Vertical Spreads with the Risk Profile Tool

Learn how to set up and analyze an options spread using the Risk Profile tool on the thinkorswim platform for more complex trades like vertical spreads.

Options

Managing Cash-Secured Puts for Income Strategies

Cash-secured puts may generate short-term income or enable purchase of desired stocks at a favorable price. Know what to do if the cash-secured put doesn't work out as planned.

The information provided here is for general informational purposes only and is not intended to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner or investment manager.

Investing involves risk, including loss of principal. Hedging and protective strategies generally involve additional costs and do not assure a profit or guarantee against loss.

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Please read the options disclosure document titled "Characteristics and Risks of Standardized Options" before considering any option transaction. Supporting documentation for any claims or statistical information is available upon request.

With long options, investors may lose 100% of funds invested.

Covered calls provide downside protection only to the extent of premiums received, and prevent any profitability above the strike price of the call.

Cryptocurrency- related products carry a substantial level of risk and are not suitable for all investors. Investments in cryptocurrencies are relatively new, highly speculative, and may be subject to extreme price volatility, illiquidity, and increased risk of loss, including your entire investment in the fund. Spot markets on which cryptocurrencies trade are relatively new and largely unregulated, and therefore, may be more exposed to fraud and security breaches than established, regulated exchanges for other financial assets or instruments. Some cryptocurrency-related products use futures contracts to attempt to duplicate the performance of an investment in cryptocurrency, which may result in unpredictable pricing, higher transaction costs, and performance that fails to track the price of the reference cryptocurrency as intended. Please read more about risks of trading cryptocurrency futures here.

Futures, futures options and Forex trading involves substantial risk and is not suitable for all investors. Please read the Risk Disclosure Statement for Futures and Options prior to trading futures products.

Forex trading involves leverage, carries a substantial level of risk, and is not suitable for all investors. Please read the Risk Disclosure for Forex.

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