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a. It is April 2020 and you believe that AAPL stock will move dramatically away (in one direction or the other) from its current price
a. It is April 2020 and you believe that AAPL stock will move dramatically away (in one direction or the other) from its current price of 276.10. You decide to play a speculative option strategy in which you take a position in 20 May 270 option contracts and 20 May 280 option contracts. Are you implementing a straddle or a strangle or a spread? b. Are you going to write or buy the May 270 option? Is your May 280 option going to be a call or a put? d. What is (are) the breakeven AAPL stock price(s)? e. Relative to the breakeven price(s), for what AAPL prices will you profit? f. Solve for the profit for the following A APL prices at expiration: 235, 260, 273, 286, 311 C
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