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Given below are the monthly values of the S&P 500 Index. Suppose that in each month you had written an out-of-the-money put option on one

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image text in transcribed Given below are the monthly values of the S\&P 500 Index. Suppose that in each month you had written an out-of-the-money put option on one unit of the index with an exercise price 5% lower than the current value of the index. Required: a-1. What would have been the average value of your gross monthly payouts on the puts over the 10-year period October 1977September 1987? (Do not round intermediate calculations. Round your answer to 4 decimal places.) a-2. The standard deviation? (Do not round intermediate calculations. Round your answer to 4 decimal places.) b-1. What would have been the average value of your gross monthly payouts on the puts if you extend the sample by one month to include October 1987? (Do not round intermediate calculations. Round your answer to 4 decimal places.) b-2. The standard deviation? (Do not round intermediate calculations. Round your answer to 4 decimal places.)

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