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A trader creates a short straddle using put and call options with a strike price of $200 per share by trading a total of 20
A trader creates a short straddle using put and call options with a strike price of $200 per share by trading a total of 20 option contracts (short 10 put contracts and short 10 call contracts). Each contract is written on 100 shares of stock. The put option is worth $14 per share, and the call option is worth $16 per share.
What is the profit of the short straddle at maturity as a function of the then stock price?
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