A trader enters into a one-year short forward contract to sell an asset for $60 when the spot price is $58. The spot price in one year proves to be $63.

Suppose that the trader also invested in a European call option that costs $1. The option matures in one year and has the strike price of $60. Draw the payoff diagram of the traders portfolio (short forward + call option), which shows how the traders payoff changes with the underlying asset price. Dont forget considering the option premium (= option cost).

Look at your answer in B. What is a single derivatives contract which provides the same payoff structure?