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Can you make arbitrage profits from the following European call prices? If so, give two such examples of arbitrage, neatly showing the portfolio construction as
Can you make arbitrage profits from the following European call prices? If so, give two such examples of arbitrage, neatly showing the portfolio construction as well as the various cash flows. The stock price is $40.
Strike Price | Expiration Month = April | EM = July | EM = September |
35 | 1 | 6 | 3 |
40 | 2 | 5 | 6 |
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