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Consider the following portfolio containing a non-dividend paying stock and options on that stock. The options expire at time=T. with exercise price Xc = 50,
Consider the following portfolio containing a non-dividend paying stock and options on that stock. The options expire at time=T. with exercise price Xc = 50, and option premium Co = 5 (per Long 1 call, option) with exercise price Xp = 45, and option premium Po = 5 (per Long 1 put, option) What will be the profit of this strategy if the stock price (ST) at time-T is $100? $50 -$40 $40 -$45 Consider the following portfolio containing a non-dividend paying stock and options on that stock. The options expire at time=T. with exercise price Xc = 50, and option premium Co = 5 (per Long 1 call, option) with exercise price Xp = 45, and option premium Po = 5 (per Long 1 put, option) What will be the profit of this strategy if the stock price (ST) at time-T is $100? $50 -$40 $40 -$45
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