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Home / Questions / You write a call option with X 5 $50 and buy a call with X 5 $60 The options are on the sa...

You write a call option with X 5 $50 and buy a call with X 5 $60 The options are on the same stock and have the same expiration date One of the calls sells for $3 the other sells for

You write a call option with 5 $50 and buy a call with 5 $60. The options are on the same stock and have the same expiration date. One of the calls sells for $3; the other sells for $9.

  1. Draw the payoff graph for this strategy at the option expiration date.

  2. Draw the profit graph for this strategy.

  3. What is the break-even point for this strategy? Is the investor bullish or bearish on the stock?

Jun 16 2020 View more View Less

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