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Shmoop's Finance Glossary defines Naked Call in relatable, easy-to-understand language.A naked call is a specific strategy used by investors who are bearish on the underlying security. This type of options trade involves selling an option contract of a security that the investor does not hold equivalent units of. In simple terms, an investor using this strategy is essentially betting that the price at expiration will be below the ...A naked long call is an options trading strategy where an investor buys a call option contract without simultaneously holding a position in the underlying asset (e.g., stock or commodity). More details on naked long calls are outlined below.

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Example of a Naked Call. Let’s look at an example of a naked call. If a stock is trading at $20, but the investor doesn’t believe the stock will climb higher than $35, he may sell a naked $35 call option. For this example, we’ll say that the premium the investor receives for the option is $100. An investor uses the naked call strategy ...

A naked option is an option contract you sell without actually owning the underlying security the contract's written on. In the case of naked calls, this involves selling a call option without ...

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