Chapter 06 · Section 6.1

Profit Potential

Market Outlook   :  BULLISH
Profit Potential :
Loss Potential   :
Breakeven Point  :

The investor's profit potential is:

b) limited.
Yes. When both calls are in-the-money, both will be exercised and the maximum profit will realized. The investor delivers on his short call and receives a higher price than he paid for receiving delivery on his long call. Continue