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for futures, we can both buy(long) and sell(short) in the futures market. However, in currency options or options on interest rate futures, we are only allowed to buy call / put option right ??? not sell call / put option ( only in the question of option for forex and interest rate not collar ! ! ! )
the reason is because i couldn’t find a single question in the p4 syllabus or in the revision kit where in option ( not collar ) questions, they only either call or put option……
But options are completely different things from futures.
You can in fact sell traded options, but what on earth would be the point (unless they were interest rate options and being used to create a collar).
The whole point about using options is to fix a ‘worst’ outcome, and to do that you always buy options.
It is no wonder that you can’t find a single question where options are being sold – it would be a ridiculous thing to do and you won’t find a single exam question on it either.
For heavens sake, watch my free lectures!
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