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Chapter 1. Introduction to Options > Basic Risk Profiles Summary

Basic Risk Profiles Summary

These are the four charts you need to remember. Even if you just remember the long call option risk profile, you should now be able to construct the other three basic option positions. When you are comfortable with these and the logic behind them, you’ll be ready to look at spreads and combinations with ease.

The Four Basic Risk Profiles for Options

The four basic options risk profiles

Imagine the dotted lines are mirrors and see how each strategy is the opposite of the one on the other side of the mirror.

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The four basic options risk profiles

Imagine the dotted lines are mirrors and see how each strategy is the opposite of the one on the other side of the mirror.

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