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Married Put vs Long Call

Discussion in 'Options' started by tom, Jun 2, 2014.

  1. tom

    tom Administrator Staff Member

    I posted an article on Married Puts versus Long Calls at
    http://capitaldiscussions.com/which-is-better-married-puts-or-long-calls/10419

    There are people that claim a married put and long call are not identical. That's true; however, they produce identical profit and loss at the same underlying prices because they are synthetically equivalent. It's a silly claim that one flavor of a position that has a synthetic equivalent is better. If you really believe that, you would load up on the one you thought was under valued and sell the the over valued equivalent and create a riskless arbitrage...essentially printing money.
     
  2. RayM

    RayM Well-Known Member

    Well said.
     

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