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Assume that Fred Noonan purchascs a put option on British pounds ( with a strike price of $ 1 . 5 0 ) for $
Assume that Fred Noonan purchascs a put option on British pounds with a strike price of $ for $ per unit. A pound option represents units. Assume that at the time of the purchase, the spot rate of the pound is $ and continually rises to $ by the explation date. The highest net profit possible for the speculator based on the information above is:
Make sure you identify the Break Even Points! You may have to add columns to the table
Long Put only
Same problem but now add the following call Warning your Break Evens will change!Assume that Fred Noonan purchases a put option on British pounds with a strike price of $ for $ per unit.
Assume that at the time of the purchase, the spot rate of the pound is $ and continually rises to $ by the explration date. To hedge his bet, Fred decides to construct a Long strangle and buy a call option. The call option has a strike price of $ and costs $D Construct the Long Strangle and Identify the Strangle's
Break Even points
Call premium
Call profit
Put premium
Put profit
Net profit
Please show what numbers should belong where on the excel sheet! Thank you!
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