Q1: 1. USD5

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Q2: 4. An agreement between two parties to facilitate a potential transaction on an underlying security at a preset price, referred to as the strike price, prior to or on the expiration date.

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Q3: 2. P.M. Settled Index Options

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Q4: I will share a personal experience that almost blew up my trading accounts when I focused solely on high Implied Volatility and disregarded the fundamentals of the company as a newbie in option tradings.

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The Implied Volatility Trap:

As a novice investor, I was captivated by the concept of Implied Volatility. I believed that high Implied Volatility alone would guarantee profitable trades. Ignoring the importance of understanding a company's fundamentals, I delved into option trading solely based on Implied Volatility.

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The Webinar Influence:

A webinar conducted by a financial guru advocating for selling put options on the stock "HUYA" further fueled my enthusiasm. Despite the guru's persuasive claims, I failed to do my homework and neglected to study the fundamental aspects of the company.

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Rushing into the Trade:

Without hesitation, I executed a sell 1 put option strategy on "HUYA" with a strike price of $12, expiring in one month, right after the U.S. market opened. I was blindly relying on high Implied Volatility as my guiding light.

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The Unexpected Turn:

Merely a week after executing the trade, news broke of China's education crackdown, causing a severe decline in Chinese concept stocks. The entire market seemed to crumble. The lack of analysis and understanding left me unprepared for this dramatic shift.

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Doubling Down on Ignorance:

In a moment of misguided optimism, I sold another put option strategy on "HUYA" with a strike price of $10, still without analyzing the situation properly. The financial guru's claims of "HUYA" being undervalued and having strong fundamentals influenced my decision.

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The Consequences Unfold:

As expected, both of my options were exercised, leaving me obligated to purchase 200 shares of "HUYA" at a total cost of $2,200. Unfortunately, the market value of the stock plummeted to only around $1,700. This loss represented a significant portion of my initial capital, jeopardising my investment journey.

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Holding Out Hope:

Despite the substantial loss, I decided to hold onto the shares, hoping for a price recovery above $12. However, my hopes were shattered when the China gaming crackdown and poor earnings reports pushed the "HUYA" stock price to less than $4. Eventually, I had to cut losses at less than $4 after learning that the fundamental of the live streaming industry was jeopardised by the competition from TikTok and its cloudy future.

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Lessons Learned:

This experience taught me valuable lessons that I will never forget. Blindly following financial gurus without conducting thorough research is a grave mistake. High Implied Volatility alone does not guarantee success; understanding a company's fundamentals is crucial. Additionally, risk management is essential to limit exposure and protect capital.

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Conclusion:

My risky option trading experience serves as a cautionary tale for new investors. Always prioritise fundamental analysis alongside Implied Volatility when making investment decisions. Remember, blindly following others can lead to disastrous outcomes. Take the time to study, learn, and develop a robust risk management strategy to safeguard your investments and improve your chances of long-term success.

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2. 4
3. 2
4. During a very uncertain time when the market was changing a lot, I saw a stock that had been going down for a while. Even though other traders and warnings told me it might not be a good idea, I thought the stock was actually undervalued and would suddenly go up. I ignored the possible risks and took a big chance. I invested a lot of my money in this stock, believing I could perfectly time the market and make a big profit when it went up quickly.But things didn't go as I hoped. Instead of going up, the stock kept going down, and I ended up losing money. I felt really desperate and held onto the investment, hoping it would somehow turn around magically. Unfortunately, the stock's decline continued, and I lost a lot of money, which had a big impact on my trading account. It was a tough lesson about the importance of being careful and not letting overconfidence guide my decisions in uncertain markets.

Q1: 1

Q2: 4

Q3: 2

Q4: The riskiest decision I have made was to start my investment journey during the COVID-19 pandemic. The stock market prices plunged back then, and many people around me panicked and sold their stock holdings. But I decided to take this opportunity to start investing. On hindsight, the COVID-19 pandemic was a great investing opportunity and all the risk I took back then was worth it.

1. 1
2. 4
3. 2
4. In a bold and audacious move, I made a risky trading decision that had my friends and fellow traders raising their eyebrows. With a surge of confidence, I invested a significant portion of my savings into an unfamiliar stock. The rollercoaster of emotions that followed matched the volatile nature of the market. I found myself eagerly tracking every market movement and news update, hoping for a positive outcome. Despite the uncertainty, luck was on my side, and the trade paid off handsomely, delivering impressive profits. Looking back, it was a lesson in embracing calculated risks and trusting my instincts, even when faced with skepticism. The experience served as a reminder that sometimes, fortune favors the bold in the unpredictable world of trading.