HOLLYWOOD STOCK EXCHANGE
THE ENTERTAINMENT MARKET
THE ENTERTAINMENT MARKET
answer...
Calls cash out at how much box office they did ABOVE the strike price (listed in stock title)
Puts cash out at how much box office they did BELOW the strike price.
Strike price is $30...
the movie does $35, then the call cashes out at $5 (amount over 30)
the movie does $25, then the call cashes out at $0 (amount over 30)
Strke price is $30
the movie does $25, then the put cashes out at $5 (amount below 30)
the movie does $35, then the put cashes out at $0 (amount below 30)
if the strike is $30 and you are sure it will do $35 then you can:
long the call (which will cash out at $5)
and
short the put (which will cash out at $0)
if the strike is $30 and you know the movie is going to bomb (make $25), you can
long the put (which would cash out at $5)
and
short the call (which would cash out at $0)
My mind got into a math orobouros: shorting a call Aug 04, 07:53
answer... Aug 04, 10:09
Keeper {nm} Nov 09, 13:21
Spulling mistake {nm} Nov 09, 13:23