![]() In this case the customer must deliver stock at $60 that is purchased at $70 for a 10 point loss (net of any credit received). The ASCA cents, including weekly small-group discussion national model: A framework for school counseling pro- focusing on developmental tasks, guest lectures by grams (2nd ed.). On the other hand, if the market rises above $70, both positions go "in the money" and are exercised. multifaceted affective curriculum for gifted adoles- American School Counselor Association. The commercial and residential snow and ice removal industry is made up of more than 40,000 contractors, nearly three-quarters of whom work in the lawn and landscape market during the warmer months. If the market falls below $60, both positions expire "out the money" and the credit is the maximum profit. In this example, if the customer sells the Jan 60 Call (higher premium) and buys the Jan 70 Call (lower premium), the customer creates a credit spread. Since the lower strike price contracts are worth more money (for calls, since the contract grants the holder the right to buy at the strike price, and lower is a better price at which to buy), the customer must buy the higher strike price contract to create a net credit position. ![]() In order for the position to be a "short call spread," the customer must be a net seller, meaning he or she must sell the more expensive contract and buy the less expensive one. ![]() Since the customer is already short a call, he must be long a call to create a spread. A spread is a buy and a sell of the same type of option with different strike prices and/or expirations.
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