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A 6-month at-the-money European call option on a non-dividend-paying stock is cur- rently selling for NOK 8.28 while a put with the same terms is
A 6-month at-the-money European call option on a non-dividend-paying stock is cur- rently selling for NOK 8.28 while a put with the same terms is selling for NOK 4.92 . The underlying stock price is NOK 75.00, and the continuously-compounded risk-free rate is 10% per year. Is there an opportunity for you as an arbitrageur? If so describe the trades you would undertake and the profit you would make; if not explain why not. A 6-month at-the-money European call option on a non-dividend-paying stock is cur- rently selling for NOK 8.28 while a put with the same terms is selling for NOK 4.92 . The underlying stock price is NOK 75.00, and the continuously-compounded risk-free rate is 10% per year. Is there an opportunity for you as an arbitrageur? If so describe the trades you would undertake and the profit you would make; if not explain why not
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