Question
9. You are given the following information for a non-dividend paying stock: 1) the current stock price is 0.25; 2) the stocks volatility is 0.35;
9. You are given the following information for a non-dividend paying stock: 1) the current stock price is 0.25; 2) the stocks volatility is 0.35; 3) the continuously compounded expected rate of return from the stock is 15%. Calculate the upper limit K such that in 6 months (i.e. T = 0.5) P[S(T) K] = 90%.
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Finance Applications And Theory
Authors: Marcia Cornett, Troy Adair, John Nofsinger
1st Edition
0073382256, 9780073382258
