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Downside risk |
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Downside riskThe risk that a security will decline in value including the implications of risk.Downside risk Similar MatchesDownside ProtectionDownside ProtectionGenerally used in connection with covered call writing, this is the cushion against loss, in case of a price decline by the underlying security, that is afforded by the written call option. Alternatively, it may be expressed in terms of the distance the stock could fall before the total position becomes a loss (an amount equal to the option premium), or it can be expressed as percentage of the current stock price. |
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