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Expiration Strike Call Put May 90.00 4.40 2.00 May 95.00 3.30 3.00 May 100.00 2.50 4.00 Current stock price is $92.00. You are considering a

Expiration

Strike

Call

Put

May

90.00

4.40

2.00

May

95.00

3.30

3.00

May

100.00

2.50

4.00

Current stock price is $92.00.

You are considering a strategy that holds one stock long; one put long with X = $90; and two calls short with X = $95. Make up the profit loss table and graph the results. Identify and plot the break even stock price and the maximum and minimum profits. Explain the situation under which you may consider this strategy.

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