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You write one IBM July 120 call contract for a premium of $4. You hold the option until the expiration date when IBM stock sells for $121 per share. You will realize a ______ on the investment. $300 profit
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You write one IBM July 120 call contract for a premium of $4. You hold the option until the expiration date when IBM stock sells for $121 per share. You will realize a ______ on the investment. $300 profit $200 loss $600 loss $200 profit

User Juozas
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1 Answer

4 votes

Answer:

The answer is a 'short call profit'

Step-by-step explanation:

Short call profit = Min [0, ($120- $121)(100)] + $400

= $300.

User Bogdan Kulynych
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