Two options, a call, a put, same underlying, same expiration date, same strike


CFAI strikes again with their Derivatives End of chapter questions:



Maybe the author omitted the all time mathematical truth that 0 is positive? Maybe he is on a whole nother planet where their math is different than ours?

If one of the options ends up ITM, the other one would have a value of 0, so both will be positive, at least in my world.

EDIT : Just googled that… 0 is neither positive nor negative. I feel so dumb LOL. Never knew this, don’t know why i always thought 0 is positive.

Zero isn’t positive; positive means greater than zero.