Option selling provides limited profit while option buying provides unlimited profit. Moreover, option buying has limited loss while option selling has unlimited loss. Option buying needs less capital, whereas option writing needs more capital. As for the reason why people opt for option writing despite its disadvantages, it will be discussed in the next lesson.
Warren Buffett’s 7 golden rules for young investors trying to manage finances
Warren Buffett shares seven essential financial lessons for young investors, emphasising frugal living, eliminating high-interest debt, long-term investing, understanding businesses, maintaining cash reserves and portfolio
November 10, 2026