Filter by Categories
Accounting
Banking

Derivatives




Naked Position


An actionless strategy in derivatives where an investor does nothing to hedge a position he has already taken in a derivative product such as an option. For example, a naked position could be the position of an investor who writes a call or put option without taking a corresponding long position or short position on the underlying asset. Such a position increases the potential reward and risk to an investor.

The naked position is the opposite of a covered position.

It is also known as an uncovered position.



ABC
Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
Watch on Youtube
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments


    Leave Your Comment

    Your email address will not be published.*