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BULL CALL, (--) - Coggle Diagram
BULL CALL
SETUP
SELL OTM
GET
WHEN COMES ITM
LESS LOSS
BUY ATM
PAY
BREAK EVEN
AT LONG STRIKE
BELOW
BOTH WILL EXPIRE WORTHLESS
LONG CALL STRIKE+NET DEBIT
2 OPTIONS
OPTION 1
BUY
OPTION 2
SELL
OPTION PREMIUM
INTRINSIC
CURRENT PRICE--STRIKE PRICE
=0
BEFORE EXPIRY
SQUARE OFF
EXTINSIC
TIME VALUE
OPTION PRICE--INTRINSIC VALUE
=0
MAX PROFIT
OPTION PREMIUM
INTRINSIC
CURRENT PRICE --STRIKE PRICE
current price>strike price
MAX PROFIT
INTRINSIC VALUE
TIME VALUE =0
BCZ INTRINSIC>OPTION PRICE
EXTINSIC
TIME VALUE
OPTION PRICE --INTRINSIC VALUE
=0
MAX LOSS
OPTION PREMIUM
INTRINSIC
CURRENT PRICE --STRIKE PRICE
=0
EXTINSIC
TIME VALUE
=0
squareoff
under time value
loss less
EXPIRY
3 SENARIO
MAX LOSS
NET DEBIT*NO OF SHARES
BOTH WILL EXPIRE WORTHLESS
WHEN BELOW THE BUY CALL
MAX PROFIT
MAX PROFIT
(SPREAD WIDTH--NET DEBIT)*NO.OF SHARES
SPREAD WIDTH
SHORT PRICE
ABOVE SHORT PRICE
2 OPTIONS
OPTION 1
SAME AS OPTION 1
DELTA USE
(--)
NET DEBIT