Ratio Call Write
Ratio Call Write is an option strategy, in which investor writes more "at the money" call options than the amount of underlying assets owned. If there is little volatility in the underlying stock, an investor will collect the premium from the sold options. However, if the price of underlying assets increases significantly, the trader will lose a lot of money.
The ratio in the ratio call writes is the sum of options written per every 100 shares in the underlying stock owned.
| Related Terms: Variable Ratio Write |