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Why Would a Trader Buy an OTM Option?

To gain high leverage for a speculative bet on a strong directional price move, with limited loss.
Greeks.Live02.11.25

Why Would a Trader Buy an OTM Option?

A trader buys an OTM option because they are cheap, offering high leverage and a large potential return if the underlying asset's price makes a significant move. It is a speculative bet on a strong directional move, with the loss limited to the small premium.

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