Question
A strategy includes three positions: 1) short one share of a stock at $96.00 per share; 2) short one share of put with strike price
A strategy includes three positions: 1) short one share of a stock at $96.00 per share; 2) short one share of put with strike price of $90.00, the premium is $5.30 per share; 3) long one share of call with strike price of $103.00 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: ______
$6.40
$3.60
-$3.6
-$6.40
2)The maximum profit from the strategy at expiration is:______
$7.40
$10.00
$5.60
$11.60
3)The minimum profit from the strategy at expiration could be:______
-$7.40
-$5.60
-$11.60
-$4.60
4)The break-even price of the strategy is:______
$94.60
$91.40
$88.60
$97.40
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