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Tag Archives: put-call parity

Put-Call Parity and Arbitrage Opportunities

Put–call parity is a principle that defines the relationship between the price of European put options and European call options of the same stock, strike price, and expiration date. The formula can identify arbitrage opportunities […]

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risk-reward profiles for covered call writing and put-selling

Comparing Covered Call Writing and Selling Cash-Secured Puts

An accepted myth is that covered call writing and selling cash-secured puts are precisely the same strategy. The reason this statement is generally accepted by many investors is that they […]

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moneyness of options impacting option prices

Moneyness of Options: Why Call and Put Premiums for the Same Stock, Strike and Expiration can be so Different/ CONTEST DEADLINE IS NOVEMBER 30th

Option trading basics teaches us that the concept of put-call parity means that for every call option price, the corresponding put option (same stock, strike and expiration) will have an implied […]

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put and call option pricing

Put-Call Parity and Synthetic Trades: Understanding Option Pricing

When we sell covered calls or cash-secured puts we understand the factors that go into the premiums we receive: The option’s exercise price The current price of the underlying The […]

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Put-Call Parity: Understanding Option Pricing

One of the mission statements of The Blue Collar Investor is to share information so that we can master option trading basics and become better investors. Many times I will […]

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