You purchased a stock for $60 a share and simultaneously wrote a covered call with a strike price of $70 on the stock. The call was selling for $0.50 at that time. Just prior to expiration, the
Stock was selling for $72 a share. What was your gain or loss per option share on this
Transaction?

Question

Quizplus · Accepted Answer

The gain is calculated as the difference between the stock's selling price at expiration ($70, since the call is exercised) and the purchase price ($60), plus the premium received ($0.50), resulting in a gain of $10.50 per share.

You Purchased a Stock for $60 a Share and Simultaneously