Understanding how to profit during a bear market is a crucial skill for every trader who aims to protect capital when the trend is bearish. In a downtrend, simply holding stocks might not work, but diversified strategies like options trading can generate returns.
When discussing settlement terms, an alternative name for cash payment settlement option is often monetary settlement, meaning the transaction is settled in cash.
An comprehensive course on options can cover advanced strategies such as call vs put options. A call gives the opportunity to purchase an asset at a set price, while a put gives the opportunity to sell it.
In trading terminology, buy to open vs buy to close is important. Entering a trade via purchase means starting a new contract, while Purchasing to exit means covering a sold position.
The popular buy to open vs buy to close iron condor technique is an income-generating options play using both a call spread and a put spread, aiming to profit from low volatility.
In market orders, bid compared to ask reflects the market spread. The bid is what the market will pay, and the ask price is what is required to sell.
For options, sell to open vs sell to close is another distinction. Sell to open means starting exposure by selling, while Closing a long position by selling means exiting a bought position.
Rolling options is adjusting an existing trade by shifting strike or expiration to capture more profit.
A trailing stop is an adjustable exit point that limits downside by adjusting as the asset moves. 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 a repeated resistance. Recognizing it can trigger short entries.
Overall, mastering these strategies — from differences between call and put to what is trailing stop loss — equips traders to succeed in any market condition.