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A speculator owns a portfolio of options on Apple stock. The speculator is long 15 call option contracts with a strike price of $170 per

A speculator owns a portfolio of options on Apple stock. The speculator is long 15 call option contracts with a strike price of $170 per share, the speculator is short 30 call option contracts with a strike price of $185 per share, and the speculator is long 6 put option contracts with a strike price of $180 per share. All option contracts are European exercise and have the same expiration date. The size of one option contract is equal to 100 shares of stock. If Apple's stock price is $179.25 per share on the expiration date, what is the speculator's total payoff at expiration?

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SOLUTION To calculate the speculators total payoff at expiration we need to consider the potential outcomes for each of the option contracts based on ... blur-text-image

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