Options

Options gives you the flexibility and ability to protect, grow or diversify their position, you can fine tune your risk exposure to meet your appetite.

With a number of strategies and jargon, Options can appear complex however all options strategies work on the same principle. Options allow you to ‘lock in’ a future buy or sell price for an underlying security. The set price you agree on won’t change and it’s this fixed element that smart investors rely on.

Options trading just got more convenient with our fully integrated platform, all the tools you need to create and execute options strategies at your fingertips. Learn more about options trading.

There are three main reasons that you may want to trade Options:

1. Earn income from your share portfolio
   You can write options against shares you already own to earn additional income. Whilst this will generate income upfront from the premium, you’ll be obliged to deliver the shares at the agreed price if the option is exercised.
    
2. Generate wealth in rising and falling markets
   As options are classed as either call or put options, you can generate wealth from rising and falling markets. You can profit from a call option in a rising market by locking in a buy price now and benefiting from the underlying security’s capital growth over time. Or alternatively, you can benefit from a put option in a falling market, by locking in a high sale price before the security’s value falls.
    
3. Hedge against share price falls
   Options can be used to offset potential falls in share prices by taking put options. This gives you the right to sell your shares at a pre-set price for the life of the option, no matter how low the share price may drop.

Once you have Options product enabled in your account, this will be available to trade in both standard and Pro platforms.

Standard platform
You can select Options from the product pop-up menu anywhere on the platform. You can also select Options from under the Products menu.

For more information, view our How to Trade Options on the CMC Markets Invest Standard Platform videos.

Pro platform
The Options finder tool under the product context menu (as shown in figure) will allow you to filter and build different Options strategies. You can select from predetermined strategies from this tool.

Also before placing an Options trade, you can view the strategy analytics from the order ticket. We also have an advanced Options analytics risk tool that will help clients perform a ‘what-if’ scenario analysis on their portfolio’s value by adjusting certain variables.

For more information, view our How to Trade Options on the CMC Markets Invest Pro Platform videos.