Question
A one year call option with an exercise price of sh. 60 is available at a premium of Sh. 6. You can also buy a
A one year call option with an exercise price of sh. 60 is available at a premium of Sh. 6. You can also buy a one- year put with an exercise price of Sh. 55 at a premium of Sh. 3. If you set up a portfolio of a put and a call, what will be your pay-off, if the share price after one year is a) Sh. 58, b) Sh. 45 or c) Sh. 75?
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Investment Analysis and Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown, Sanford J. Leeds
11th Edition
1305262999, 1305262997, 035726164X, 978-1305262997
