GLOSSARY ENTRY (DERIVED FROM QUESTION BELOW) | ||||||
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07:26 Mar 12, 2005 |
German to English translations [PRO] Bus/Financial - Investment / Securities / Derivatives | |||||||
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| Selected response from: Ralf Lemster Germany Local time: 10:09 | ||||||
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Summary of answers provided | ||||
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5 +3 | naked short position |
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naked short position Explanation: ...as opposed to a "covered" call position, for example, where the obligations from the sold call option are covered by holding the underlying assets. The difference is the risk exposure: naked short positions can be subject to unlimited risks, whereas a covered position has limited exposure. (In the case of the covered call, the risk is opportunity risk - if the market rises strongly, the seller will be missing out.) |
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