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Consider the following positions on the Intel stock. For each of the positions choose the strike X = $35. Choose May option. a. Long 1

Consider the following positions on the Intel stock. For each of the positions choose the strike X = $35. Choose May option.

a. Long 1 call contract. b. Short 1 put. c. Long 1 call + short 1 put. d. Long 1 call + long 1 put. e. Long 1 call with strike $35 and short 1 call with strike $36.

Assume that you enter and close the positions at the mid point of bid-ask spread.

For each position (a-e) answer the following questions. Assume that you trade each contract on March 19 (i.e. enter the positions).

1. Close out your positions on April 2. Calculate your net dollar gain or loss.

2. Now assume that you exercise options on April 2. For each position compute your net gain or loss.

3. For each position draw the payoff diagram, marking the strikes and the stock price on April 2 clearly, as well as your payoff.

March 19

INTC (INTEL CORP)

35.27 +0.13

Calls

Last Sale

Net

Bid

Ask

Vol

Open Int

Maturity

Strike

Puts

Last Sale

Net

Bid

Ask

Vol

Open Int

INTC1721D34-E

1.52

+0.05

1.49

1.58

31

2130

17 Apr 34.00

INTC1721P34-E

0.22

-0.05

0.20

0.27

152

7982

INTC1721D35-E

0.82

+0.05

0.77

0.81

395

33754

17 Apr 35.00

INTC1721P35-E

0.47

-0.07

0.48

0.51

941

23354

INTC1721D36-E

0.31

-0.01

0.31

0.34

293

23203

17 Apr 36.00

INTC1721P36-E

1.06

-0.09

1.00

1.07

136

13063

INTC1721D37-E

0.10

-0.02

0.09

0.16

106

31141

17 Apr 37.00

INTC1721P37-E

1.89

+0.07

1.78

1.84

6

14357

INTC1719E34-E

1.81

-0.04

1.78

1.87

1

2083

17 May 34.00

INTC1719Q34-E

0.72

+0.02

0.66

0.70

3

21363

INTC1719E35-E

1.17

-0.01

1.14

1.22

128

14612

17 May 35.00

INTC1719Q35-E

1.10

-0.03

1.05

1.09

738

5707

INTC1719E36-E

0.68

0.0

0.68

0.72

51

7127

17 May 36.00

INTC1719Q36-E

1.67

-0.03

1.57

1.62

27

4125

INTC1719E37-E

0.35

-0.02

0.37

0.40

64

41621

17 May 37.00

INTC1719Q37-E

2.29

-0.38

2.28

2.33

14

4487

April 2

INTC (INTEL CORP)

36.07 +0.32

Calls

Last Sale

Net

Bid

Ask

Vol

Open Int

Maturity

Strike

Puts

Last Sale

Net

Bid

Ask

Vol

Open Int

INTC1721D34-E

2.20

+0.29

2.09

2.31

12

1691

17 Apr 34.00

INTC1721P34-E

0.05

-0.02

0.03

0.05

41

10462

INTC1721D35-E

1.28

+0.27

1.18

1.26

81

35964

17 Apr 35.00

INTC1721P35-E

0.13

-0.05

0.09

0.14

45

29410

INTC1721D36-E

0.52

+0.14

0.44

0.52

590

34400

17 Apr 36.00

INTC1721P36-E

0.39

-0.19

0.39

0.42

89

14592

INTC1721D37-E

0.14

+0.05

0.07

0.14

127

32331

17 Apr 37.00

INTC1721P37-E

1.29

0.0

1.01

1.06

0

16694

INTC1719E34-E

2.08

0.0

2.28

2.47

0

2049

17 May 34.00

INTC1719Q34-E

0.33

-0.07

0.32

0.34

46

27998

INTC1719E35-E

1.62

+0.37

1.51

1.56

23

14373

17 May 35.00

INTC1719Q35-E

0.56

-0.18

0.57

0.61

44

10524

INTC1719E36-E

0.92

+0.16

0.85

0.93

424

10856

17 May 36.00

INTC1719Q36-E

0.97

-0.17

0.97

1.01

40

3896

INTC1719E37-E

0.46

+0.07

0.44

0.48

162

46610

17 May 37.00

INTC1719Q37-E

1.67

-0.16

1.56

1.61

1

4510

March 19

INTC (INTEL CORP)

35.27 +0.13

Calls

Last Sale

Net

Bid

Ask

Vol

Open Int

Maturity

Strike

Puts

Last Sale

Net

Bid

Ask

Vol

Open Int

INTC1721D34-E

1.52

+0.05

1.49

1.58

31

2130

17 Apr 34.00

INTC1721P34-E

0.22

-0.05

0.20

0.27

152

7982

INTC1721D35-E

0.82

+0.05

0.77

0.81

395

33754

17 Apr 35.00

INTC1721P35-E

0.47

-0.07

0.48

0.51

941

23354

INTC1721D36-E

0.31

-0.01

0.31

0.34

293

23203

17 Apr 36.00

INTC1721P36-E

1.06

-0.09

1.00

1.07

136

13063

INTC1721D37-E

0.10

-0.02

0.09

0.16

106

31141

17 Apr 37.00

INTC1721P37-E

1.89

+0.07

1.78

1.84

6

14357

INTC1719E34-E

1.81

-0.04

1.78

1.87

1

2083

17 May 34.00

INTC1719Q34-E

0.72

+0.02

0.66

0.70

3

21363

INTC1719E35-E

1.17

-0.01

1.14

1.22

128

14612

17 May 35.00

INTC1719Q35-E

1.10

-0.03

1.05

1.09

738

5707

INTC1719E36-E

0.68

0.0

0.68

0.72

51

7127

17 May 36.00

INTC1719Q36-E

1.67

-0.03

1.57

1.62

27

4125

INTC1719E37-E

0.35

-0.02

0.37

0.40

64

41621

17 May 37.00

INTC1719Q37-E

2.29

-0.38

2.28

2.33

14

4487

April 2

INTC (INTEL CORP)

36.07 +0.32

Calls

Last Sale

Net

Bid

Ask

Vol

Open Int

Maturity

Strike

Puts

Last Sale

Net

Bid

Ask

Vol

Open Int

INTC1721D34-E

2.20

+0.29

2.09

2.31

12

1691

17 Apr 34.00

INTC1721P34-E

0.05

-0.02

0.03

0.05

41

10462

INTC1721D35-E

1.28

+0.27

1.18

1.26

81

35964

17 Apr 35.00

INTC1721P35-E

0.13

-0.05

0.09

0.14

45

29410

INTC1721D36-E

0.52

+0.14

0.44

0.52

590

34400

17 Apr 36.00

INTC1721P36-E

0.39

-0.19

0.39

0.42

89

14592

INTC1721D37-E

0.14

+0.05

0.07

0.14

127

32331

17 Apr 37.00

INTC1721P37-E

1.29

0.0

1.01

1.06

0

16694

INTC1719E34-E

2.08

0.0

2.28

2.47

0

2049

17 May 34.00

INTC1719Q34-E

0.33

-0.07

0.32

0.34

46

27998

INTC1719E35-E

1.62

+0.37

1.51

1.56

23

14373

17 May 35.00

INTC1719Q35-E

0.56

-0.18

0.57

0.61

44

10524

INTC1719E36-E

0.92

+0.16

0.85

0.93

424

10856

17 May 36.00

INTC1719Q36-E

0.97

-0.17

0.97

1.01

40

3896

INTC1719E37-E

0.46

+0.07

0.44

0.48

162

46610

17 May 37.00

INTC1719Q37-E

1.67

-0.16

1.56

1.61

1

4510

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