... option, the most an option buyer can lose if interest rates move against him is thepremium paid for the option. Unlike a Treasurysecurity, however, an option can expire worth-less. Option selling ... holder would have lost the totalpremium of $750, in this example. However,no matter how low interest rates decline themost that can be lost is the premium paid.19Importantly, if the yield on ... strikes (5) less thepremium received for selling the spread(3.50). However, no matter how low interestrates decline, the most that can be lost is$150.00, the difference between the strikesless...