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Finance Dictionary and Glossary of Investment Terms
uncovered call
Definition 1.
A short call option position in which the writer does not own the corresponding number of shares of the underlier, or has not deposited in a cash account an amount equal to the exercise value of the call. also called naked call. opposite of covered call.
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Definition 2.
See Naked Calls
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Definition 3.
A short call option position in which the writer does not own shares of underlying stock represented by the option contracts. Uncovered calls are much riskier for the writer than a covered call, where the writer of the uncovered call owns the underlying stock. If the buyer of a call exercises the option to call, the writer would be forced to buy the asset at the current market price. Also called a "naked" asset.
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