Question
A strategy includes three positions: 1) short one share of a stock at 96 per share 2) short one share of put with strike price
A strategy includes three positions: 1) short one share of a stock at 96 per share 2) short one share of put with strike price of 90, a premium is 5.30 per share 3) long one share of call with strike price of 103 and premium of 3.90 per share. Assuming the investor holds the strategy until expiration of the put and the call options.
1. if the market price of the stock is 101 at expiration, the profit from the strategy would be:
2: The maximum profit from the strategy at expiration is:
3: the minumum profit from the strategy at expiration could be:
4. The breakeven price of the strategy is:
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