FFAI study

 ✅ Big reward if stock jumps, but very risky—most likely you lose the $7 unless it pops above $2.57 fast.

📊 Example: $2.0 Call (Cost = $0.29)

• Strike price = $2.00
• Premium paid = $0.29 ($29 per contract)
• Breakeven = $2.29.

✅ Costs more, but safer. You only need a small move above $2.29 to profit.

🎯 Summary

• $2.5 Call (cheap lottery ticket) → High risk, low cost. Needs a bigger move to pay off.
• $2.0 Call (expensive but safer) → More upfront cost, but easier to profit if stock rises slightly.

Do you want me to also show you step-by-step how to actually place the trade on your app 

(Buy → Select strike → Confirm)

 so you can practice with small contracts?

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 Perfect 👍 Let’s do a step-by-step profit/loss breakdown for the $2.5 Call (Sep 5 expiry, premium = $0.07) and compare it to the $2 Call (premium = $0.29) since those are right around the current price ($2.25).

📊 Example: $2.5 Call (Cost = $0.07)

• Strike price = $2.50
• Premium paid = $0.07 ($7 per contract, since 1 option = 100 shares)
• Breakeven = $2.57

FFAI Stock Price at Expiry	Option Value (Intrinsic)	Profit/Loss per Share	Profit/Loss per Contract
$2.30	$0.00	$0.07	$7 (lose full premium)
$2.50	$0.00	$0.07	“$7 (still worthless)
$2.57	$0.07	$0.00	$0 (breakeven)
$2.70	$0.20	+$0.13	+$13
$3.00	$0.50

FFAI

 Perfect 👍 Let’s do a step-by-step profit/loss breakdown for the $2.5 Call (Sep 5 expiry, premium = $0.07) and compare it to the $2 Call (premium = $0.29) since those are right around the current price ($2.25).

📊 Example: $2.5 Call (Cost = $0.07)

• Strike price = $2.50
• Premium paid = $0.07 ($7 per contract, since 1 option = 100 shares)
• Breakeven = $2.57

 

1. What is a Call Option?

A call option is a contract that gives you the right (but not the obligation) 

to buy a stock at a certain price (called the strike price) 

before a set date (the expiration date).

• Buyer of a call = bets the stock will go up.
• Seller of a call = bets the stock will stay flat or go down.

2. Key Terms You See

• Strike Price: The agreed price where you can buy the stock.
• Expiration Date: The last day the option is valid (your screen shows Sep 5, Sep 12, Sep 19, etc.).
• Premium: The price you pay to buy the option (e.g., $0.07 for the $2.5 Call).
• Breakeven: Strike price + premium = the stock price you need at expiration to not lose money.

3. Example With Your Screenshot

Stock price: $2.25

Option: 

$2.5 Call (expires Sep 5)

• Cost (premium): $0.07 per share
• Total cost: $7 (because each contract = 100 shares → $0.07 × 100)
• Breakeven: $2.57
• Meaning:
  
• If FFAI rises above $2.57 by Sep 5, you make profit.
• If it stays below $2.5, your option expires worthless and you lose your $7.
• 
  

Option: 

$2 Call (expires Sep 5)

• Cost (premium): $0.29
• Breakeven: $2.29
• Meaning:
  
• Safer since the strike is close to current price ($2.25).
• You pay more, but you only need FFAI to rise above $2.29 to profit.
• 
  

4. How You Make Money

✅ If stock goes up above breakeven → your option gains value. You can:

• Sell the option contract for profit (most common).
• Exercise the option (rare in short-term trading) and actually buy shares at the strike.

❌ If stock goes down or flat, the option loses value and can expire worthless.

5. Risk vs Reward

• Buying Calls: Risk is limited (only the premium you pay). 
• Profit potential is unlimited if the stock skyrockets.
• But most short-term options expire worthless, so timing is everything.

👉 Quick check for you:

Would you like me to make a step-by-step example (like: “If you buy the $2.5 Call at $0.07, here’s how much you’d gain/lose if FFAI closes at $2.30, $2.50, $2.70, $3.00”) so you see the profit/loss clearly?