What Is the Primary Risk of Selling a ‘Naked Call’ Option?

Selling a 'naked call' means selling a call option without owning the underlying asset. The primary risk is unlimited potential loss.

If the underlying asset's price rises significantly above the strike price, the seller is obligated to buy the asset at the high market price to deliver it at the lower strike price. Since the asset's price can theoretically rise indefinitely, the potential loss for the seller is uncapped.