https://www.investopedia.com/terms/o/option.asp

Usually they have those advanced options trading, but you ended up buying more and more and more options for stretegy. It is like similar to DCA. someone fk up and bought it at 52week high, and they buy more shares of xyz shares to lower the % of loss.

When GME was high 300s, buying GME PUT was a freebee. There is no way I am going to skip on feb Put 350. Spent about 52, but it was well worth it.


Remember, more complexed/advanced Options trading strategy, more $$$ spend on premiums.


3 reasons I will buy options.
1. Constantly reaching 52week high or 52 week low. I am not in hell is going to pay investment income on large amount of shares. and I invest/long term position trade based on cap gain. So, I know I will be holding the stock for less than 52wk. I buy options.
2. I know for sure it will go up or down, and I need to make money on movement.
3. I need to protect my shares from falling, and I need to keep it for 52weeks. I am sure it will be losses for sure, but I am not going to cash in early for tax hit. I just buy options as an insurance to protect the shares.