=+18. At time t = 0 an investor bought (long position) one European call with strike K1
Question:
=+18. At time t = 0 an investor bought (long position) one European call with strike K1
=£20 and one European call with strike K2
=£40, she also borrowed (short position) two European calls with strike K3
=£30. All the options are on the same underlying and with the same maturity T.
Such a portfolio is called a butterfly spread. Draw the payoff diagram for this butterfly spread.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Question Posted: