call options:
prediction for next 30/60 days
say AAPL stock price is $100 today
In the option
I can predict it shall be $75 or less in next 30/60 days A stipulated premium is calculated say $9/100 share. break even point is fixed say $115/share. I pay maximum of $90 loss. Gain is > $0 if share price > $115 ~ $chance value(high if low)*10
at the option
break even at $100+premium
strike deal any time it crosses $100 +premium for profit = $chance value (high if chance is low)*10
out the option
option say $150
break even $150+premium
premium * 10 < share price $150 = loss
$chance value (>$150) * 10 = profit
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