Option Writing – Unlimited risk and Limited profit potential

In Continuation with Previous Article Mistakes to avoid when writing/shorting Options

Option Writing – Unlimited risk and Limited profit potential

An option buyer has limited risk and unlimited profit potential, so if 1 lot of 8000 Nifty call was bought at Rs 130, the maximum loss on this trade is the Rs 9750 (Rs 130 x 75), and if Nifty went to 8300 the call would make a profit of Rs 22,500 (300*75).
An option writer has unlimited risk and limited profit potential.
When you write an option, say 1 lot of 8000 CE

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