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Fred has now been with CSE for three years. Ensure that written authorization is obtained from the client evidencing a brokerage firm's discretionary authority (prior to trading), stating the type of transactions permitted. When the underlying striksr price is above the option strike price, the call holder can earn a marginal profit of F - K by exercising the option, so the payoff line is kinked at F K, the point where the option goes in-the-money.
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