Kim is bullish on a technologystockthat trades at $120. Because it is too expensive to buy 100 shares of the stock, she decides to buy a bull call spread on the stock to hedge theriskand acquire the stock at a lower price. Therefore, she buys a bull call spread for $2.20, paying ...
Catastrophe insurance option call spreadPresents statistics on catastrophe insurance option call spreads as of January 6, 1995.Business Insurance
The Long Call Ladder Spread, also known as the Bull Call Ladder Spread, is an improvement made to an extremely popular options trading strategy, the Bull Call Spread. It further eliminates capital outlay by writing an additional further out of the money call option of the same expiration month...
Diagonal Calendar Call Spread In this version of the Calendar Call Spread, all you have to do is to purchase an In the Money (ITM) LEAP and then sell At the Money (ATM) or Out of the Money (OTM) near term calls against the LEAP. ...
A bull call spread (long call spread) is a vertical spread consisting of buying the lower strike price call and selling the higher strike price call, both expiring at the same time. The strike price of the short call, represented by point B, is higher th
What trading strategy creates a reverse calendar spread? Explain why brokers require margins when the clients write options but not when they buy options. What is the difference between a call and a put option? (Be clear in your answer.) What does the ...
For call options, the strike price represents the price above which the underlying asset must rise for the option to be profitable. Conversely, for put options, the strike price represents the price below which the underlying asset must fall for the option to be profitable. Generally, the ...
Bear Call Spread: (short call strike price + the premium received from the sale of the short call) Bull Call Spread: (long call strike price + the net premium paid to buy the long call) Bear Put Spread: (long put strike price - the net premium paid to buy the long put) Bull Put...
The higher the strike price of the out of the money call options shorted in a Call Ratio Spread, the higher the maximum profit attainable by the Call Ratio Spread will be if the initial net credit is kept the same. However, that also means that the stock needs to rally more in order ...
Call Time Spread, the Horizontal Call Time Spread exceeds the profitability of a Diagonal Call Time Spread significantly when the underlying stock remains totally stagnant. As such, if you think a stock is going to stay extremely stagnant, the Horizontal Call Time Spread would be your options ...