Chapter 06 · Section 6.1
Time Decay
Which of the following statements are correct?
d) Time decay hurts your position at line B.
No. From line B onward, the profit/loss profile of the position resembles that of a short call position. Short calls are helped by time decay, not hurt.
e) a and b
f) b and c
a) Time decay helps your position at line A.
b) Time decay helps your position at line B.
c) Time decay hurts your position at line A.