Call and Put Premium Discrepancy
As a trader, we might have observed that the premium of the call option and put option, which are equidistant from the spot price are not equal. Either the call option is trading at a premium or discount viz a viz put option. The question that comes to our end is why it is happening.
In this video, we will discuss and answer the following 3 questions.
Why the premiums of the equidistant call option and put option are not the same i.e. why one of the options is trading at a premium or discount?
What is the reason for the discrepancy in the premium of a call and put option in this scenario?
If you are using a short straddle or iron condor option strategy then what adjustment do you need to make in your strategy so that you do not incur loss due to this anomaly or maximize your profitĀ