Stock options don’t just magically appear out of thin air though. Someone has to provide them. At the end of the day, somebody is taking the unbounded risk, no matter how they’ve packaged it, and if that person or organization reaches their risk limit and says “nope, this is too risky even for me” then you’re out of luck. Yes, realistically there will always be someone willing to take that kind of bet on Tesla, but it doesn’t mean it’ll be easy to find or that it will always be available through the usual channels.
the downsides is options are time limited. If the stock doesn’t crash before the end you have lost your investment. You can keep buying the option but time is still working arainst you
Most people short a stock by buying options. The loss in that situation is limited to the commission you pay to buy the option.
Stock options don’t just magically appear out of thin air though. Someone has to provide them. At the end of the day, somebody is taking the unbounded risk, no matter how they’ve packaged it, and if that person or organization reaches their risk limit and says “nope, this is too risky even for me” then you’re out of luck. Yes, realistically there will always be someone willing to take that kind of bet on Tesla, but it doesn’t mean it’ll be easy to find or that it will always be available through the usual channels.
the downsides is options are time limited. If the stock doesn’t crash before the end you have lost your investment. You can keep buying the option but time is still working arainst you