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What Is a ‘Naked Call’ and What Is Its Risk Profile?

A naked call is an unhedged short call option with unlimited loss potential and maximum gain limited to the premium received.
Greeks.Live07.11.25

What Is a ‘Naked Call’ and What Is Its Risk Profile?

A naked call is a short call option position where the seller (writer) does not own the underlying asset. The risk profile is unlimited potential loss because the underlying asset's price can theoretically rise indefinitely.

The maximum gain is limited to the premium received. It is considered a high-risk strategy.

How Does a Short Put Differ from a Long Call in Terms of Payoff?
What Is the Maximum Profit Potential of a Covered Call?
What Is the Maximum Gain for a Call Option Buyer?
What Is the Difference between an Unhedged Long Position and a Covered Call’s Loss Profile?

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