Also known as: Married Call
Short shares + buy call as upside hedge. Caps loss if the stock rallies.
Shape illustration on a normalized underlying — open the Lab below to price it on a real option chain.
Short stock plus a long call as insurance: the call caps how much a rally can hurt the short position.
When holding a short stock position through event risk you cannot ignore.
The insurance premium is a drag on the position; maximum loss becomes defined (strike minus entry, plus premium).
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Educational content — not investment advice. Options involve substantial risk and are not suitable for every investor. All trading on Opus Options Trading is simulated.