4. You purchase a put option on Swiss francs for a premium of $.05, with an...
4. You purchase a put option on Swiss francs for a premium of $.05, with an exercise price of $.50. The option will not be exercised until the expiration date, if at all. If the spot rate on the expiration date is $.58, how much is the payoff of this long option? And your profit? (And also, please draw the payoff diagram to a long put option holder, optional, for extra credits). (Answer: -$0.05; 0)
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4. You purchase a put option on Swiss francs for a premium of
$.05, with an...
13. The premium on a pound put option is $.03 per unit. The exercise price is...
13. The premium on a pound put option is $.03 per unit. The exercise price is s1.60. The break-even point for the buyer and seller is? (Assume put option are speculators.) zero transactions costs and that the buyer and seller of the 14. You purchase a call option on pounds for a premium of $.03 per unit, with an exercise price of $1.64; the option will not be exercised until the expiration date, if at all. If the spot rate...
Assume the August call and put option on Swiss francs have the same strike price of 58½ ($0.5850/...
Assume the August call and put option on Swiss francs have the same strike price of 58½ ($0.5850/SF), and premium of $0.005/SF. In what price range the purchase of the PUT option would choose to exercise the option? a. at all spot rates above the strike price of 58.5 b. at the strike price of 58.5 c. at all spot rates below the strikes of 58.5 d. at all spot rates below the 59
Q1: If Jasim purchase a put option on Canadian dollar from Sara for a premium of...
Q1: If Jasim purchase a put option on Canadian dollar from Sara for a premium of € 0.03, with an exercise price of € 0.42. The option will not be exercised until the expiration date, if at all. If the spot rate on the expiration date is € 0.37. a) What is the net profit for Jasim and Sara per unit? (1 mark) SZERE- ---ODDELEEEEEEEEEE -OOOOOOOOOOOOOOOOOOOOOOOOO SEBEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE b) If you know that one option contract represents 20000 units, what is...
Long currency straddle Call option premium = $0.05/€, Put option premium = $0.05/€ Strike price =...
Long currency straddle Call option premium = $0.05/€, Put option premium = $0.05/€ Strike price = $1.10/€, Option contract size = €62,500 Draw graphs of call option, put option, and straddle Mark BE point and Strike prices Mark each premium Spot exchange rate $1.00/€ $1.05/€ $1.10/€ $1.15/€ $1.20/€ $1.25/€ Long call option Exercise (N/Y) Holder’s net profit per unit Long put option Exercise (N/Y) Holder’s net profit per unit Net profit Net profit per unit (graph) Short currency straddle Call...
• Long cury strangle Call option premium - 50.03., Put option premium - $0.02 € Call...
• Long cury strangle Call option premium - 50.03., Put option premium - $0.02 € Call option strike price 1.25/6, Put option strike price $1.15 € Option contract size - €62,500 Draw graphs of call option, put option, and straddle Mark BE point and Strike prices Mark each premium 1 S105 S 15E $1.20 € $1.25 € $1.30/E Long call option Spot exchange rate Exercise (NY) Holder's net profit per unit Exercise (NY Holder's net profit per unit Net profit...
1*.[2 points] You purchase a 6-month call option on euro for a premium of S0.05 per...
1*.[2 points] You purchase a 6-month call option on euro for a premium of S0.05 per unit, with an exercise (strike) price of $1.16; the option will not be exercised until the expiration date, if at all. You borrowed the money for the premium at 8% continuous compounding rate. If the euro's market price on the expiration date (t 6/12) is $1.06, how much is your net profit/loss per unit in dollars and in euros? Facts Graph: Calculations
• Short currency strangle . Call option premium - $0.03/€, Put option premium - $0.028€ Call...
• Short currency strangle . Call option premium - $0.03/€, Put option premium - $0.028€ Call option strike price = $1.15/€, Put option strike price - $1.05/€ Option contract size = €62,500 Draw graphs of call option, put option, and straddle • Mark BE point and Strike prices • Mark each premium $1.05/€ $1.10/€ $1.15/€ | $1.20/€ $1.25/€ $1.30/€ Spot exchange rate Does holder exercise? Sell call option Holder's net profit per unit Seller's net profit per unit Does holder...
Consider a European call option on €62,500 with an exercise price of $1.50/€. You pay an...
Consider a European call option on €62,500 with an exercise price of $1.50/€. You pay an option premium of $0.10/€ for the call option today. a. If the $-€ spot exchange rate is $1.62/€ on the contract expiration date, would you exercise the call option (buy € at the exercise price at expiration)? What would be the option payoff and profit? b. If the $-€ spot exchange rate is $1.45/€ on the contract expiration date, would you exercise the call...
You purchase 5 put option contracts with a premium of $3.86 and an exercise price of...
You purchase 5 put option contracts with a premium of $3.86 and an exercise price of $80. If the stock price at expiration of the contracts is $86.27, what is your profit?
You have written a put on yen with a strike of ¥115.00/$ at a premium of...
You have written a put on yen with a strike of ¥115.00/$ at a premium of 0.0080 cents per yen and an expiration of six months from now. The option is for ¥12,500,000. What is the profit or loss if the spot price at maturity is ¥110/$? $0, option is not exercised. $1,000, option is not exercised. $1,000, option is exercised. -$3528.98, option is exercised.
13. The premium on a pound put option is $.03 per unit. The exercise price is s1.60. The break-even point for the buyer and seller is? (Assume put option are speculators.) zero transactions costs and that the buyer and seller of the 14. You purchase a call option on pounds for a premium of $.03 per unit, with an exercise price of $1.64; the option will not be exercised until the expiration date, if at all. If the spot rate...
Q1: If Jasim purchase a put option on Canadian dollar from Sara for a premium of € 0.03, with an exercise price of € 0.42. The option will not be exercised until the expiration date, if at all. If the spot rate on the expiration date is € 0.37. a) What is the net profit for Jasim and Sara per unit? (1 mark) SZERE- ---ODDELEEEEEEEEEE -OOOOOOOOOOOOOOOOOOOOOOOOO SEBEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE b) If you know that one option contract represents 20000 units, what is...
• Long cury strangle Call option premium - 50.03., Put option premium - $0.02 € Call option strike price 1.25/6, Put option strike price $1.15 € Option contract size - €62,500 Draw graphs of call option, put option, and straddle Mark BE point and Strike prices Mark each premium 1 S105 S 15E $1.20 € $1.25 € $1.30/E Long call option Spot exchange rate Exercise (NY) Holder's net profit per unit Exercise (NY Holder's net profit per unit Net profit...
1*.[2 points] You purchase a 6-month call option on euro for a premium of S0.05 per unit, with an exercise (strike) price of $1.16; the option will not be exercised until the expiration date, if at all. You borrowed the money for the premium at 8% continuous compounding rate. If the euro's market price on the expiration date (t 6/12) is $1.06, how much is your net profit/loss per unit in dollars and in euros? Facts Graph: Calculations
• Short currency strangle . Call option premium - $0.03/€, Put option premium - $0.028€ Call option strike price = $1.15/€, Put option strike price - $1.05/€ Option contract size = €62,500 Draw graphs of call option, put option, and straddle • Mark BE point and Strike prices • Mark each premium $1.05/€ $1.10/€ $1.15/€ | $1.20/€ $1.25/€ $1.30/€ Spot exchange rate Does holder exercise? Sell call option Holder's net profit per unit Seller's net profit per unit Does holder...
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