Easy way to remember Derivatives
I have found very good advice on this forum on how to remember the payoff graphs of derivatives like Bull Call, Bear Put etc.
But is there an easy way to remember whether the instruments used to make up these instruments should be In the Money, Out of the Money or At the Money?
For example, a Bull Call is supposed to be made up of a ITM Long Call and a OTM Short Call. I can’t figure out why this is so.
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