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Foreign portfolio management involves understanding buying power. Buying power reduction refers to the capital needed to maintain certain positions in a brokerage account. Naked option strategies may require higher capital to cover potential losses. It's important to grasp the risks associated with trading options, and buying power is a good risk measure. While this segment doesn't cover futures or Futures options, understanding buying power helps determine the risk level of trades. It's crucial to be comfortable with the capital required for trading.
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