a question on options 2011, price, question

joehogue

The premium(S0-C0) is the breakeven price of a covered call.
The premium(CL-CH) is the max loss of a bull call spread.

Any intuitive explanation? Thanks.



Edited 1 time(s). Last edit at Monday, May 2, 2011 at 01:36PM by deriv108.

Analti_Calte

I'm assuming that "break even price" means the difference to the strike, not the actual price of the stock.