1. Speculation: Individual investors can use stock options to speculate in order to profit from stock price fluctuations. If you have a clear view of the price trend of a stock, you can buy a call option or a put option to earn the difference caused by price changes.
2. Protection or hedging: If you hold some stocks, but you are worried about the risk of future market decline, you can buy put options, so that when the stock price falls, you can get some protection through options and reduce potential losses.
3. Increase income: By selling (selling) call options, you can collect royalties as income. If the stock price does not reach the exercise price of the subscription option when the option expires, you can keep the income and continue to hold the stock.
4. Diversified portfolio: Stock options can be used in diversified portfolios, allowing you to participate in the price trends of different underlying assets, thereby reducing risks and increasing investment opportunities.
5. Income strategy: Individual investors can earn royalties by selling put options or subscribing options, so as to realize a continuous income stream.
6. Make up your position: If you already hold a stock, but you are worried about the future price decline, you can buy put options as protection to reduce potential losses.
7. Realize the option: Buying a call option allows you to buy stocks at a predetermined price at a specific time in the future. This allows you to buy stocks at a lower price when the stock price rises.
8. Short-term trading: Individual investors can use options for short-term trading and profit from small price fluctuations.