by Michael Shulman 05/05/08
Q: I think I understand how a call option works -- I profit if the stock goes up. But how does a put work?
A: A put is the opposite position from a call. As the security decreases in price, you will profit. If the security moves up in price, then your put will likely lose value.
For more about playing falling stocks with put options, you may want to check out my video on OptionsZone TV, "The Short Trade."
When the banks are losing money, who profits? I'll show you how a 10-point drop in a stock led to a 179% gain on the short side.
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Declining Dollar Tree Turns Giving Tree
You know what you can get for a buck, besides a hamburger or a candy bar? An incredible short-side position that could turn 500% in a matter of weeks.
A quick quiz -- what are the three things you can short? Check your answers below.
Live Well, Thanks to Dying Companies
If you don't want to buy a company's products or services, you shouldn't buy their stocks.
