How Does a Covered Call Differ from a Protective Put Strategy? ⎊ Path

How Does a Covered Call Differ from a Protective Put Strategy?

A covered call is an income-generating strategy that caps potential upside gain. A protective put is an insurance strategy where an investor buys a put option on an asset they already own.

The protective put is used to limit potential downside loss while retaining full upside potential, essentially acting as portfolio insurance.

How Can a Covered Call Strategy Be Used to Generate Income from Locked Governance Tokens?

What Is a “Covered Call” Strategy and How Is It Used for Hedging?

How Does a “Covered Call” Strategy Work?

How Can a ‘Protective Put’ Strategy Be Used to Manage Downside Risk on a Long Crypto Position?

Why Is the Covered Call Considered a Limited-Risk Options Strategy?

What Is a Covered Call Strategy and How Might a Custodian’s Client Use It to Generate Yield?

How Do Derivatives like Options Help Custodians Manage Crypto Price Volatility?

How Are Covered Calls Used by Custodians to Generate Yield and Hedge Risk?

Glossar

Covered Call

Strategy ⎊ This involves selling a call option on an asset that the investor already owns, thereby generating immediate income against potential appreciation.

Protective Put

Hedge ⎊ A protective put, within cryptocurrency derivatives, functions as a limited-risk strategy employed to mitigate downside exposure in an underlying asset, typically a digital currency holding.