The put spread will expire worthless - you keep the $100 credit received.
The short call will be assigned - in other words, you will have to sell 100 shares at $50/share.
The long call will get exercised (check with your broker to verify they will auto-exercise an in-the-money long option). This means you will buy 100 shares at $60/call.
Since you sell 100 and buy 100, you are left without a stock position. You bought at 60, sold at 50. You have lost $10/share * 100 shares, a net loss of $1000. But, you collected $100 credit for the call spread.
The net -> $1000 loss plus 2 * $100 credit = $800 loss (not including commissions).
Doug
P.S. Keep studying and make sure to do some paper trades before using real money (winners and losers to understand how this really works).
From: paul7313
Sent: Thursday, June 10, 2010 7:24 AM
Subject: [TheOptionClub.com] what am I missing when trading options?
I sell an IC; 1 contract; sell 50 and buy 60 call, and sell 40 and buy 30 put. both give me a credit of 1. when the options expire, the stock is 64
the call is worth -100, the put is worth 100. total 0
or the IC is worth 200 minus the 100 call= 100 total
I want to get this right before I risk real money
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