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Prior to buying or selling an option, you should read the Options Clearing Corporation Characteristics and Risks of Standardized Options. Copies of this document may be obtained from your broker or from any exchange on which options are traded.
It states, in part, that trading in options is subject to a complete loss of capital (and, in some situations, more than the amount initially invested) and is only appropriate for persons who can bear that risk. Options trading is speculative and subject to a high degree of risk; option sellers are subject to margin calls and exposed to virtually unlimited risk. Refer to Advantages and Disadvantages of Options and carefully consider whether such trading is suitable for you in light of your financial condition.
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