Chapter 06 · Section 6.1

Profit Potential

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

The investor's profit potential is:

• a) unlimited.
  No. The trader receives a premium for incurring the obligation to deliver. If the market price falls, he will not have to deliver on an out-of-the-money short call.
  b) limited.

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