We pay a option premium when we buy call option. When we replicate this...
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We pay a option premium when we buy call option.
When we replicate this position by delta hedging, hedging cost is corresponded with option premium that we paid.
Question.
We receive an option premium when we write a call option. I want to generate profits similar to option premiums by replicating the position of writing a call option. Please explain how we can generate such profits with delta hedging strategy.
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