Tuesday, January 30, 2018

Option pricing is nuts

Why do deep in the money options have only about $1 premium but options with call prices 6$ out of the money have a premium of $2.50? Sure the ITM option will require more cash to buy but each $1 increase will be equal $1 increase in value. For example : msft April 20 call at 80 costs $15/share April 20 call at 100 costs 2.60/share



Submitted January 29, 2018 at 09:42PM by Moveover33 http://ift.tt/2FpEqy7

No comments:

Post a Comment