I am very new to options, and was wondering about a scenario to generate income based on speculative price movement in the future.
SP-500 ETFcurrently trading at $200
- Speculate that
SP-500 ETFwill trade at $180 within two months
Is it possible to purchase the
put optionwith the intent to sell the option if the strike price does execute (thereby making margin gain of selling the option at a higher price).
Is this considered a
Would I have to purchase the underlying security in the option if
SP-500 ETFdoes not hit the strike price within the option time period?