On august 19 you bought the APR 15 , K=30 call and simultaneously sold the APR 15 K=32.5 call. The options were not exercised till their expiration.
Calculate your profit/loss per share at expiration if MMML’s price at expiration were $36.50/share.
On august 19 you bought the APR 15 , K=30 call and simultaneously sold the APR 15 K=32.5 call. The options were not exercised till their expiration.
Calculate your profit/loss per share at expiration if MMML’s price at expiration were $36.50/share.
Homework Answers
| 1 | At Inception | ||
| Bought Apr 15, K = 30 call | $ -2.40 | ||
| Sold Apr 15, K = 32.50 call | $ 1.30 | ||
| On Expiry : MMM's Price were $36.50 | |||
| So the call K = 30 will be at 6.50 ($36.50 - $30) | |||
| So the call K = 32.50 will be at 4.00 ($36.50 - $32.50) | |||
| Profit on K = 30 call | $ 4.10 | (6.50 - 2.40) | |
| Loss on K = 32.50 call | $ -2.70 | (1.30 - 4.00) | |
| Net Profit | $ 1.40 | ||
Add Answer to:
On august 19 you bought the APR 15 , K=30 call and
simultaneously sold the APR...
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On August 19 you sold the APR 15, K=30, call and at the same
time you sold the APR 15 K=30 put. Suppose that both options will
not be exercised till their expiration; Calculate your profit/loss
per share at expiration if MMML’s price at
expiration were:
6.1 S = 35;
6.2 S = 30;
6.3
S = 25.
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