Options & Showing Working

[agulani]

Hi All,
I wanted to get your thoughts on showing your work for calcs for options.
For example. I don’t remember the formula for a lot of the option strategies but I understand the underlying concept and how it works which works far better for me than remembering some formula which will just confuse me
For example, I don’t know the formula for figuring out the breakeven price for a butterfly spread, but when I look at the numbers it’s very easy for me the figure out in my head.
If I got a question in the test and it wants the break even price and I just write the answer, would I get full credit? let me know your thoughts.

 

[breadmaker]

The more steps you show the grader, the more likely you will receive some points. You’ve said you can look at the numbers and figure it out in your head: whatever you’re doing in your head, write it down! Give the grader something to show your thought process: draw the payoff graph (doesn’t have to be fancy), show answer = # + # - #, etc. Give ‘em something - anything!!!!
Scenario: what if you make a slip of the calculator for your final answer? If you’ve done the intermediate steps correctly, I would be more inclined to throw you some points for your work, but not for your final answer itself.

 

[agulani]

True, very valid point!
Thanks Breadmaker