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 the market price reaches or exceeds the higher exercise price, both options will be out-of-the-money and will expire worthless. The trader will realize his maximum profit, the net premium. Continue