Unlimited Risk

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Dictionary Says

Definition of 'Unlimited Risk'

The risk of an investment that has unlimited downside potential.
Investopedia Says

Investopedia explains 'Unlimited Risk'

Examples of investments with inherent unlimited risk include short positions and futures contract trading. In short selling or trading futures contracts, the potential to lose more than your initial investment is theoretically infinite.

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'Unlimited Risk'

  • Cut Down Option Risk With Covered Calls

    http://www.investopedia.com/articles/optioninvestor/071201.asp
    ... For some traders, the disadvantage of writing options naked is the unlimited
    risk. ... But when you are a seller, you assume unlimited risk. ...

  • Naked Options Expose You To Risk

    http://www.investopedia.com/articles/optioninvestor/08/naked-options.asp
    ... While it won't change the fact that this trade has unlimited risk, choosing
    your strike prices wisely can alter your risk exposure. ...

  • Should Your Options Go Naked?

    http://www.investopedia.com/articles/optioninvestor/05/010505.asp
    Compare naked strategies to credit spreads and see if the
    unlimited risk of going naked is worth it. ...

  • Get A Strong Hold On Profit With Strangles

    http://www.investopedia.com/articles/optioninvestor/08/strangle-strategy.asp
    ... If you are short a strangle, you want to make sure that the likelihood of the option
    expiring, as indicated by a low delta, will offset the unlimited risk. ...

  • Options On Gold And Silver ETFs

    http://www.investopedia.com/articles/exchangetradedfunds/09/options-gold-silver-etfs.asp
    ... up and maintaining the required amount of margin money and would also expose a trader
    to unlimited risk on the upside if silver suddenly rocketed higher. ...

  • Short Selling Risk Can Be Similar To Buying Long

    http://www.investopedia.com/articles/stocks/08/short-selling-risk.asp
    ... are that: In the long term, markets trend upward. Short selling can expose
    investors to potentially unlimited risk. While the longest ...

  • Option Spreads: Debit Spreads Structure | Investopedia

    http://www.investopedia.com/university/optionspreadstrategies/optionspreads3.asp
    ... Therefore, when we combine these into a spread, the unlimited risk posed by selling
    an option (such as our FOTM IBM call option from previous examples), is ...

  • Synthetic Options Provide Real Advantages

    http://www.investopedia.com/articles/optioninvestor/08/synthetic-options.asp
    ... or call option without the restriction of having to pick a strike price At the same
    time, the synthetic positions are able to curb the unlimited risk that a ...

  • Bear Put Spreads: A Roaring Alternative To Short Selling

    http://www.investopedia.com/articles/optioninvestor/09/bear-vertical-put-spread.asp
    ... Secondly, there is technically unlimited risk, because there is no limit as to how
    far the stock could rise in price after the investor sold short the shares. ...

  • Short Goldman Sachs

    http://stocks.investopedia.com/stock-analysis/moneyshow/ShortGoldmanSachsGSwithLowRisk.aspx
    ... decline in Goldman Sachs (GS) continues, option traders can employ a specific spread
    trade strategy that provides limited risk and unlimited profit potential. ...

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