Option Strategies represent predefined combinations of two or more options contracts, or options and an underlying asset, structured to achieve specific risk-reward profiles. These strategies are deployed based on anticipations of future price movements, volatility levels, and time decay in the underlying cryptocurrency.
Mechanism
These structured trades involve the simultaneous buying and selling of various call or put options with differing strike prices and expiration dates. Common configurations include vertical spreads, straddles, and iron condors, each designed to capitalize on particular market conditions while systematically limiting potential losses.
Methodology
Institutional crypto options traders employ these sophisticated strategies to manage risk, generate income, or speculate on market direction with controlled capital exposure. The selection of an appropriate strategy relies on a comprehensive market outlook, risk tolerance, and capital efficiency considerations, often executed through Request for Quote (RFQ) platforms for block transactions.
Best execution measurement evolves from minimizing single-asset price impact for stocks to optimizing multi-dimensional risk transfer cost for options.
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