Question
Current stock price for Amazon is $810. A call option on Amazon stock with the exercise price of $810 and maturity of 1 month sells
Current stock price for Amazon is $810. A call option on Amazon stock with the exercise price of $810 and maturity of 1 month sells at $5 premium. Ignore interests. (1) Plot the payoff against Amazons stock price if you buy only Amazon stock What is your max gain? What is your max loss?
(2) Plot the payoff against Amazons stock price if you sell only call option on Amazon stock What is your max gain? What is your max loss?
(3) Plot the payoff against Amazons stock price if you buy Amazon stock and sell call option on Amazon stock What is your max gain? What is your max loss?
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