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A trader creates a short butterfly spread using put options with strike prices of $160, $180, and $200 per share by trading a total of
A trader creates a short butterfly spread using put options with strike prices of $160, $180, and $200 per share by trading a total of 20 option contracts (short 5 contracts at $160, long 10 contracts at $180 and short 5 contracts at $200). Each contract is written on 100 shares of stock. The options are worth $20, $29, and 40 per share of stock, respectively. What is the profit of the short butterfly spread at maturity as a function of the then stock price?
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