What’s the difference between naked option Buying vs Normal option buying vs hedging option buying
The difference is basically risk
Naked option buying is more riskier compared to hedging options
As in naked option buying you only have one leg or one position so the risk is high whereas in hedging you have multiple legs which reduces the risk
You can refer to Zerodha Varsity for detailed information
Naked and Normal option buying is the same thing.
Hedging is when you buy options to hedge or reduce the risk of an open F&O position or holdings.
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