Financial

Uncovered options

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Uncovered options

See: Naked options
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Naked Option

An option contract without another, opposite option hedging the risk. Unlike more complex spreads and straddles, which involve the purchase or sale of multiple options in order to profit in different ways, naked options are straightforward calls or puts. An investor with a naked option makes a profit or loss depending on the movement of the underlying asset. Naked options are also called uncovered options. See also: Covered options.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
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