Homework Answers
We see that the breakeven price on the investment=strike
price-option price=25-1.50
=23.50
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Please show work. Thank you! 11) Jaime wrote (sold) a nine-month put on Beta stock (each put option is for 100 units of...
Cara wrote a put option contract on EZ stock with an exercise price of $40 per share and an optio...
Cara wrote a put option contract on EZ stock with an exercise price of $40 per share and an option price of $.65 per share. Today, the contracts expire and the stock is selling for $34.30 a share. What is the net profit on this investment? Ignore trading costs and taxes. Multiple Choice $63.50 −$505.00 $635.00 $50.50 −$635.00
You buy one November $179 (strike) put on stock XYZ for an option premium of $10. Ignoring transactions costs and time v...
You buy one November $179 (strike) put on stock XYZ for an option premium of $10. Ignoring transactions costs and time value of money, what is the break-even stock price of this position? Break even means zero profit / loss. Round your answer to 2 decimal places (nearest cent).
Question 6 2 pts You buy one November $154 (strike) put on stock XYZ for an option premium of $12. Ignoring transaction...
Question 6 2 pts You buy one November $154 (strike) put on stock XYZ for an option premium of $12. Ignoring transactions costs and time value of money, what is the break-even stock price of this position? Break even means zero profit/loss. Round your answer to 2 decimal places (nearest cent).
Problem-04a: You purchase (long position) 15 European put option contracts on BBB stock at the premium...
Problem-04a: You purchase (long position) 15 European put option contracts on BBB stock at the premium of $6.80. The exercise price of the option is $75, the maturity of the options is 2-month, and stock is currently trading at $75. i. What is the payoff of your position if the stock price at maturity is $70? Show your result numerically. ii. Repeat i. for the stock price at maturity of $83. Problem-04b: For the problem-04a: i. What is the profit...
ABC, a non-dividend paying stock Details of European option prices follows on are as Option type...
ABC, a non-dividend paying stock Details of European option prices follows on are as Option type Exercise price Option premium Call on Stock ABC $17.50 $20 $5.50 $3.50 Required: Create a call ratio spread by using the above options. A call ratio spread consists of taking a long position in a bull spread and selling another call on the same stock with the strike price of $20. Draw the profit and loss diagram (on the following page) of the call...
Problem-03a: You sell (short position) 12 European call option contracts on ZZZ stock at the premium...
Problem-03a: You sell (short position) 12 European call option contracts on ZZZ stock at the premium of $8.5. The exercise price of the option is $100, the maturity of the options is 3-month, and the stock currently is trading at $98. i. What is the payoff of your position if the stock price at maturity is $105? Show the result numerically. ii. Repeat i. for the stock price at maturity of $93. Problem-03b: For problem-03a: i. What is the profit...
Please explain the answer or steps. Thank you. 21. You write a call option with X S55 and buy a call with X $65. The options are on the same stock and have the same expiration date. One of the calls...
Please explain the answer or steps. Thank you.
21. You write a call option with X S55 and buy a call with X $65. The options are on the same stock and have the same expiration date. One of the calls sells for $3; the other sells for $9. What is the break-even point for this strategy? A) $55 B) $60 CS61 (Ans: Higher the strike, lower the price of the call. Because S55 strike pays over [55 to infinity]...
Hello, Please provide details for the answers. Thank you! A put option on British pounds has...
Hello,
Please provide details for the answers.
Thank you!
A put option on British pounds has a strike (or exercise) price of $1.60/BP and the put premium per British pound is $0.03. If he spot FX rate at the expiration date is $1.55/BP, what would be the net profit of this put option holder. (calculate the net profit calculation & draw a net profit graph precisely) 3. 0.02 US one year interest rate is 6% annual and EU one year...
Show work please You purchase one (1) call option with strike price 50 for $ 9...
Show work please You purchase one (1) call option with strike price 50 for $ 9 and write three (3) call options with strike 60 for $ 3. 1) Draw the payoff and profit table for this strategy at maturity. 2) When do you break-even (profit=0) at maturity? 3) What are your anticipations about the stock at maturity (when do you make money)? 4) Assume that you may purchase calls with strike price 70 for $ 1. How many options...
I screenshot everything and put them in order, please complete every little boxes. the others are...
I screenshot everything and put them in order, please complete
every little boxes. the others are the info provided for it.
Problems: Nondirection Dependent Strategies -- Straddles and Strangles Straddles and Strangles can be profitable regardless of which way the underlying moves -- profitability is not dependent on the direction of the underlying. Depending on whether you are long or short the position, profitability may not depend upon a move at all. This does not by any means make them...
Question 6 2 pts You buy one November $154 (strike) put on stock XYZ for an option premium of $12. Ignoring transactions costs and time value of money, what is the break-even stock price of this position? Break even means zero profit/loss. Round your answer to 2 decimal places (nearest cent).
ABC, a non-dividend paying stock Details of European option prices follows on are as Option type Exercise price Option premium Call on Stock ABC $17.50 $20 $5.50 $3.50 Required: Create a call ratio spread by using the above options. A call ratio spread consists of taking a long position in a bull spread and selling another call on the same stock with the strike price of $20. Draw the profit and loss diagram (on the following page) of the call...
Please explain the answer or steps. Thank you.
21. You write a call option with X S55 and buy a call with X $65. The options are on the same stock and have the same expiration date. One of the calls sells for $3; the other sells for $9. What is the break-even point for this strategy? A) $55 B) $60 CS61 (Ans: Higher the strike, lower the price of the call. Because S55 strike pays over [55 to infinity]...
Hello,
Please provide details for the answers.
Thank you!
A put option on British pounds has a strike (or exercise) price of $1.60/BP and the put premium per British pound is $0.03. If he spot FX rate at the expiration date is $1.55/BP, what would be the net profit of this put option holder. (calculate the net profit calculation & draw a net profit graph precisely) 3. 0.02 US one year interest rate is 6% annual and EU one year...
I screenshot everything and put them in order, please complete
every little boxes. the others are the info provided for it.
Problems: Nondirection Dependent Strategies -- Straddles and Strangles Straddles and Strangles can be profitable regardless of which way the underlying moves -- profitability is not dependent on the direction of the underlying. Depending on whether you are long or short the position, profitability may not depend upon a move at all. This does not by any means make them...
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