For average crypto trader that is here it is better to simply buy/sell than buy/hedge. Why hedge if you can sell?
If your coins are locked in other investments - For example, you buy BNB to be able to take part in IEOs and in the same time you short BNB on futures (or options) to get rid of currency risk. Other example - you buy btc to use it in yours casino bankroll and to get rid of currency risk you short btc in the same time. In other situations it is mostly better to simply sell rather than using advanced trading techniques that may lead to big losses when used wrong.
Topic: Insure your Bitcoin with options - page 2. (Read 583 times)
I am not a fan when it comes to Option trading. I believe it is the worst way of trading and mostly would get you into trouble, so got to be extremely careful with our approach to these things. I am always very careful given I know the impact that it could have.
Options are more complicated than futures IMO.
I think people should just stick with trading futures, since they're automatically settled at maturity, whereas options can difficult for noobs to grasp—especially if they're noobie enough to keep getting rekt in a market that is almost perpetually bullish (except lately).
I haven't yet come across a site that makes BTC options accessible to novices, Deribit certainly doesn't do the job.
I think people should just stick with trading futures, since they're automatically settled at maturity, whereas options can difficult for noobs to grasp—especially if they're noobie enough to keep getting rekt in a market that is almost perpetually bullish (except lately).
I haven't yet come across a site that makes BTC options accessible to novices, Deribit certainly doesn't do the job.
Gonna try buying a put to save my BTC 
Always getting REKT by the volatile crypto market? You can insure (aka hedge in trading terms) your crypto assets with options trading.
What does this mean?
Hedging is a trading strategy to reduce or eliminate the risk of holding one position by taking on another position.
One simple example is to compare it to insurance, which is basically a form of hedging.
How do options come in?
Options and its trading terminologies may sound complex. However in layman terms, the mechanics behind options trading can be referenced to the insurance industry — where people pay a premium to insure their health. In fact, we could say that insurance providers are simply options sellers!
Here’s an example of how you can use options to insure your BTC.
Example: Insuring your BTC by buying a put option
If you hold 1 BTC you bought at $7,000 and is long term bullish but afraid of short term volatility, you can buy a put option priced at $200 to protect your position against a possible crash.
If BTC nosedived, your maximum loss will be capped at $200.
If BTC dipped to $6,000 on Settlement Date, you will lose $1,000 value from your BTC. However, your put option will have an intrinsic value of $1,000 and can be sold for that amount thus offsetting potential losses and limiting your loss to your Premium Payable.
Summary
Options can be used as an effective hedging tool — as a protection against market volatility for cryptocurrency holders or as part of a wider trading strategy for professional traders.
Read full article with accompanying images here: https://blog.sparrowexchange.com/insure-your-bitcoin-with-options/
What does this mean?
Hedging is a trading strategy to reduce or eliminate the risk of holding one position by taking on another position.
One simple example is to compare it to insurance, which is basically a form of hedging.
How do options come in?
Options and its trading terminologies may sound complex. However in layman terms, the mechanics behind options trading can be referenced to the insurance industry — where people pay a premium to insure their health. In fact, we could say that insurance providers are simply options sellers!
Here’s an example of how you can use options to insure your BTC.
Example: Insuring your BTC by buying a put option
If you hold 1 BTC you bought at $7,000 and is long term bullish but afraid of short term volatility, you can buy a put option priced at $200 to protect your position against a possible crash.
If BTC nosedived, your maximum loss will be capped at $200.
If BTC dipped to $6,000 on Settlement Date, you will lose $1,000 value from your BTC. However, your put option will have an intrinsic value of $1,000 and can be sold for that amount thus offsetting potential losses and limiting your loss to your Premium Payable.
Summary
Options can be used as an effective hedging tool — as a protection against market volatility for cryptocurrency holders or as part of a wider trading strategy for professional traders.
Read full article with accompanying images here: https://blog.sparrowexchange.com/insure-your-bitcoin-with-options/
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