Chapter 06 · Section 6.1

Breakeven Point

Market Outlook  : BEARISH
Profit Potential: limited to 
                  the net premium
loss Potential   :  limited
Breakeven Point  :

The investor breaks even when the market price equals:

b) the higher exercise price plus the net premium.
No. The trader will be losing money at this point. The price must drop for the trader to breakeven.