• bitcoinBitcoin$19,279.750.16%
  • ethereumEthereum$1,306.340.03%
  • elrond-erd-2Elrond$48.381.89%

Bullish Traders Cast Low-Risk Ethereum Options Bets Using a Clever Strategy

Ether has been making rather higher lows throughout this year, with the current trend pointing out that $1,800 might represent the bottom for April. Even those who aren’t using technicals have gone to be more optimistic since Visa announced it would initiate a pilot for settling transactions in USD Coin (USDC) via the Ethereum network.

Taking into consideration the fact that the price for Ether might reach new yearly highs, there are a few investment options available. Of course, buying and holding is seen by many as being the best strategy, as well as a leveraged long position up to 2x.

The problem comes from the downside, as a 20% move means 40% loss in futures contracts. Naturally, this doesn’t leave a lot of room for additional leverage since it asks for a big upfront.

Then again, options strategies offer excellent opportunities for those traders who have a fixed-range target.

This bullish strategy means acquiring 10 Ether worth of $1,600 put options, but, at the same time, selling the same amount of $2,240 calls. In order for the trade to be finalized, the buyer will need to sell 7.5 Ether worth of $2,080 put options and then balance it by acquiring 8 Ether contracts of $2,880 call.

In contrast with perpetual futures, options come with an expiry date that is already set, which means the outcome you aim for will need to take place during that period of time.

Source: Cointelegraph.com

Previous articleNext article

Leave a Reply

Your email address will not be published.