when trading just a regular Call option? Example..... MCD currently trading at $93.55 The September $94 Call ( 28 days to exp. ) has a Bid of .90 and Ask of .98 So my question is, when exactly will I start to make a profit on my Call option? Does the Option/Stock have to move..... 1. The .08 cents between the Bid x Ask spread 2. The cost to buy the Call for .98 cents 3. The difference between the $94 Call minus the price that the stock is currently trading at of $93.55 = .45 cents So is the total required move in the stock, before I realize 1 cent of profit , $1.51 ( .08 + .98 + .45 ) ? Thanks for the help, very much appreciated - Michael<!-- google_ad_section_end -->
No. You can make profit on bought call option even if price of stock drops a little bit - in case IV going up...