Long Call

Long call: buyers of call options hope the stock to increase substantially and thereby to make a profit by the following selling the call at a profit before the option expires.

The loss is limited to the option premium the buyer paid for its purchase. The buyer loses his money if the spot price of the particular asset is less than the strike price when expiring.

Long calls establish limited risk and unlimited reward. The break-even point of this kind of option is equal to strike price plus premium. Long calls are used when the buyers are bullish on the market. Call options can be either American or European contracts. Call option buyers should pay attention to the intrinsic value of the option and its time value in order to pay less for the time.

Call long

If someone buys the call option for the price of $20 when the strike is $100, the break-even point will be $120 ($100+$20), so the buyer will have this contract in-the-money if he exercises it at a price say $121, $130 and so on up to the asset upward movement end and he will suffer losses if this option is expired at a price below this mark.

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