A investor writes a $45-strike price call option for $3, and at the same time, holds a

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A investor writes a $45-strike price call option for $3, and at the same time, holds a $40-strike price call option for $5. All the options have the same expiry date. What is the name of this strategy? Also, in terms of "profit".

What is the maximum loss and what is maximum profit that can be generated from the strategy?

Related Book For answer-question

Fundamentals of Cost Accounting

ISBN: 978-0077398194

3rd Edition

Authors: William Lanen, Shannon Anderson, Michael Maher

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Posted Date: Mar 31, 2023 12:15 AM

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A investor writes a $45-strike price call option for $3, and at the same time, holds a

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The name of this strategy is a bear call spread It is a type of vertical spread strategy where the i... View the full answer

Fundamentals of Cost Accounting

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