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What is the impact of rolling a call option on cryptocurrency trading?

avatarGDFMKDec 27, 2021 · 3 years ago1 answers

Can you explain the effects of rolling a call option on cryptocurrency trading? How does it affect the overall trading strategy and potential profits? What are the risks involved in rolling a call option in the cryptocurrency market?

What is the impact of rolling a call option on cryptocurrency trading?

1 answers

  • avatarDec 27, 2021 · 3 years ago
    Rolling a call option in cryptocurrency trading can be a useful strategy for traders who believe that the price of the underlying cryptocurrency will continue to rise but need more time for their prediction to come true. By rolling the call option, traders can extend the expiration date and potentially benefit from further price appreciation. However, it's important to note that rolling a call option also comes with costs. Traders need to consider the fees associated with closing the existing option and opening a new one. Additionally, if the market doesn't move as expected, rolling can lead to additional losses. It's crucial for traders to carefully assess the market conditions and their risk tolerance before deciding to roll a call option in cryptocurrency trading.