Please help I know answer is 73.374 but I don't know how to get it.
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Please help I know answer is 73.374 but I don't know
how to get it.
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GS stock is currently worth $56. Every year, it can increase by 30% or decrease by...
GS stock is currently worth $56. Every year, it can increase by 30% or decrease by 10%. The stock pays no dividends, and the annual continuously-compounded risk-free interest rate is 4%. Using a two-period binomial option pricing model, find the price today of one two-year European put option on the stock with a strike price of $120.
Hello, I don't just need to know the answer but also how to work out the...
Hello, I don't just need to know the answer but also how to work
out the problem by hand. Thanks for any and all help!
13) Underlying asset price at current time is $100 and (up factor in the binomial tree) is 1.05 and (down factor in the binomial tree) is 0.95. Exercise price is $95 and risk-free rate is 0.02%. Assume one-period model. (Use this for all 3 questions) What is the European call option price? a) $1.51 b)...
1. Consider the following information about a European call option on stock ABC: . The strike...
1. Consider the following information about a European call option on stock ABC: . The strike price is S100 The current stock price is $110 The time to expiration is one year The annual continuously-compounded risk-free rate is 5% ·The continuous dividend yield is 3.5% Volatility is 30% . The length of period is 4 months. Find the risk-neutral probability p*. Hint: 45.68%
Consider a European put option on the stock of XYZ, with a strike price of $30...
Consider a European put option on the stock of XYZ, with a strike price of $30 and two months to expiration. The stock pays continuous dividends at the annual continuously com- pounded yield rate of 5%. The annual continuously compounded risk free interst rate is 11%. The stock currently trades for $23 per share. Suppose that in two months, the stock will trade for either $18 per share or $29 per share. Use the one-period binomial option pricing to find...
5. Consider a European call option on the stock of XYZ, with a strike price of...
5. Consider a European call option on the stock of XYZ, with a strike price of $25 and two months to expiration. The stock pays continuous dividends at the annual yield rate of 5%. The annual continuously compounded risk free interst rate is 11%. The stock currently trades for $23 per share. Suppose that in two months, the stock will trade for either S18 per share or $29 per share. Use the one-period binomial option pricing model to find today's...
The current price of a continuous-dividend-paying stock is $100 per share. Its volatility is given to...
The current price of a continuous-dividend-paying stock is $100 per share. Its volatility is given to be 0.30 and its dividend yield is 0.03. The continuously-compounded, risk-free interest rate equals 0.06. Consider a $95-strike European put option on the above stock with three months to expiration. Using a one-period forward binomial tree, find the price of this put option. (a) $3.97 (b) $4.38 (c) $4.70 (d) $4.97 (e) None of the above.
The current price of a continuous-dividend-paying stock is $100 per share. Its volatility is given to...
The current price of a continuous-dividend-paying stock is $100 per share. Its volatility is given to be 0.30 and its dividend yield is 0.03. The continuously-compounded, risk-free interest rate equals 0.06. Consider a $95-strike European put option on the above stock with three months to expiration. Using a one-period forward binomial tree, find the price of this put option. (a) $3.97 (b) $4.38 (c) $4.70 (d) $4.97 (e) None of the above.
Please only help me with 1.5(a). 1.3. You enter into a forward contract to buy 100...
Please only help me with 1.5(a). 1.3. You enter into a forward contract to buy 100 shares of Volkswagen stock in 1 year for 120/share. The current price of one share is 126.25. You paid 971 for this contract. In 1 year, the price of the stock is 128. The risk free rate over the year was 5%, compounded continuously. a) What is the payoff of your forward contract? b) What is the profit of your forward contract? 1.4. Use...
The spot price per share is $115 and the risk free rate is 5% per annum...
The spot price per share is $115 and the risk free rate is 5% per annum on a continuously compounded basis. The annual volatility is 20% and the stock does not pay any dividend. All options have a one-year maturity. In answering the questions below use a binomial tree with three steps. Each step should be one-third of a year. 1)Using the binomial tree, compute the price at time 0 of a one-year European put option on 100 shares of...
Hello, I don't just need to know the answer but also how to work out the...
Hello, I don't just need to know the answer but also how to work
out the problem by hand. Thanks for any and all help!
25. Suppose you purchase one Texas Instruments August 75 call contract quoted at $9.50 and write one Texas Instruments August 80 call contract quoted at $7.7. If, at expiration, the price of a share of Texas Instruments stock is $79, your profit would be A) $150 C) $350 $220 $510 B) D)
Hello, I don't just need to know the answer but also how to work
out the problem by hand. Thanks for any and all help!
13) Underlying asset price at current time is $100 and (up factor in the binomial tree) is 1.05 and (down factor in the binomial tree) is 0.95. Exercise price is $95 and risk-free rate is 0.02%. Assume one-period model. (Use this for all 3 questions) What is the European call option price? a) $1.51 b)...
1. Consider the following information about a European call option on stock ABC: . The strike price is S100 The current stock price is $110 The time to expiration is one year The annual continuously-compounded risk-free rate is 5% ·The continuous dividend yield is 3.5% Volatility is 30% . The length of period is 4 months. Find the risk-neutral probability p*. Hint: 45.68%
Consider a European put option on the stock of XYZ, with a strike price of $30 and two months to expiration. The stock pays continuous dividends at the annual continuously com- pounded yield rate of 5%. The annual continuously compounded risk free interst rate is 11%. The stock currently trades for $23 per share. Suppose that in two months, the stock will trade for either $18 per share or $29 per share. Use the one-period binomial option pricing to find...
5. Consider a European call option on the stock of XYZ, with a strike price of $25 and two months to expiration. The stock pays continuous dividends at the annual yield rate of 5%. The annual continuously compounded risk free interst rate is 11%. The stock currently trades for $23 per share. Suppose that in two months, the stock will trade for either S18 per share or $29 per share. Use the one-period binomial option pricing model to find today's...
Hello, I don't just need to know the answer but also how to work
out the problem by hand. Thanks for any and all help!
25. Suppose you purchase one Texas Instruments August 75 call contract quoted at $9.50 and write one Texas Instruments August 80 call contract quoted at $7.7. If, at expiration, the price of a share of Texas Instruments stock is $79, your profit would be A) $150 C) $350 $220 $510 B) D)
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