... accessible tool that helps investors and traders manage risks and implement basic investment strategies. In this article, we will analyze how European options work, their main advantages, disadvantages and application examples. Find out why this type of options is suitable for long-term investments and how to use them to protect your portfolio or speculate. European Options: A Comprehensive Review and Application European options are financial instruments that grant the buyer the right, but not the obligation, to buy or sell ...

... of European analogues. Complexity of management: It is more difficult for sellers to predict when the buyer will exercise their right, which increases uncertainty. Examples of American Options Applications Investing in stocks: An investor buys a Call option on a stock with a long-term expiration date. If the stock price rises before the expiration date, he can exercise the option early and sell the stock to lock in a profit. Hedging risks: A company that buys raw materials buys a Put option on a commodity. If the price of ...

... it to fall to $60. If the price falls, he can sell the oil at $80 and make a profit of $20 per barrel (excluding the premium). 2. Hedging Risks Options are often used to protect a portfolio from adverse price changes. This is especially important for long-term investors and companies exposed to market risk. Put Option Example: An investor who owns a stock might buy a put option to hedge against a fall in the stock's price. If the stock's price falls, the loss from the fall is offset by the gain from the option. Example: A company that imports oil might buy put ...

..., etc.) continue to play a decisive role in the long-term assessment of Bitcoin and Ethereum. Therefore, it is important for long-term investors to separate the short-term "noise" caused by derivatives from actual trends. Conversely, short-term ... ... as opportunities for active trading, strictly adhering to risk management principles. Conclusion The upcoming expiration of options on July 25 serves as a test for the maturity of the cryptocurrency market. Its scale demonstrates how much interest in ...

... major event — particularly the September quarterly expiration, which traditionally has an even larger scale of open interest. Long-term market participants note that the impact of one-time expirations is short-lived. Fundamental drivers — such as macroeconomic ... ... the overall price trend. However, the increased volumes of derivatives indicate the maturation of the cryptocurrency market. Options and futures are transforming from niche instruments into a significant pricing factor. Consequently, savvy investors must ...