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ETH Call Selling Without Coverage Can Lead to Negative ETH Balance at Expiry

Hi Mark, if ETH calls are sold without holding ETH as coverage, it will result in a negative ETH balance upon expiration, which must then be offset by selling USDC or another collateral currency.
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AI Analysis

This situation underscores the importance of proper risk management when trading options, especially cryptocurrencies like ETH. Selling a call option typically requires the seller to have the underlyi...

AI Recommendation

Given this scenario, it is vital for traders to ensure they hold the necessary collateral before selling ETH call options. If they do not own ETH, they should consider alternative strategies such as p...

Disclaimer

The AI analysis and recommendations provided are for informational purposes only. Any investment decisions should be made at your own risk. Past performance is not indicative of future results. Always conduct your own research and consider consulting with a financial advisor before making any investment decisions.

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