6140 Portfolio Payoff 60.5 Dollars (8) 60.0 59.5 59.0 20 40 60 80 120 30 50 70 90 100 110 Stock Price at = 7 Note the values of the initial stock price and forward price: So = $60 F = $60 r(interest rate): 0% Select ALL trading strategies below that would feature a payoff equivalent to that shown in the graph above: (You do not need to combine answers to form a single payoff - each answer is its own trading strategy) CIN Sell zero coupon bonds with a FV = $60 Buy zero coupon bonds with a FV = $60 Short the forward contract, sell zero coupon bonds with a FV-$60 and buy the stock a Long the forlard contract short the stock and buy zero coupon bonds with a FV = $60 6140 Portfolio Payoff 60.5 Dollars (8) 60.0 59.5 59.0 20 40 60 80 120 30 50 70 90 100 110 Stock Price at = 7 Note the values of the initial stock price and forward price: So = $60 F = $60 r(interest rate): 0% Select ALL trading strategies below that would feature a payoff equivalent to that shown in the graph above: (You do not need to combine answers to form a single payoff - each answer is its own trading strategy) CIN Sell zero coupon bonds with a FV = $60 Buy zero coupon bonds with a FV = $60 Short the forward contract, sell zero coupon bonds with a FV-$60 and buy the stock a Long the forlard contract short the stock and buy zero coupon bonds with a FV = $60