Suppose you bought ABC stock at $50 and sold a $54 Call expiring in December for $1. Name the strategy, calculate break-even, max. profit, max. loss and describe the rationale of using the strategy. Draw a graph to help illustrate your answer. Will this strategy be useful to manage risk?

Answer rating: 100% (QA)

The strategy you are referring to is known as a covered call strategy Here are the details Strategy ... View the full answer