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An investor creates a strangle: she buys a European put having an exercise price $80 and a European call having an exercise price $90. Suppose
An investor creates a strangle: she buys a European put having an exercise price $80 and a European call having an exercise price $90. Suppose at the exercise date the underlying security price turns out to be $86. What is the gain/loss for this investor? Explain.
please show the works to determine whether there is gain or loss for the investor.
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