Question
In early April 2023, Cochlear is trading at $248.07. The $260 call option that expires in 315 days is trading at a premium of $13.91
In early April 2023, Cochlear is trading at $248.07. The $260 call option that expires in 315 days is trading at a premium of $13.91 and the put option of the same series is trading at $25.14. These prices seem odd to you and you suspect that an arbitrage opportunity exists. You note the continuously compounded risk free rate is 2.5652%. What trade do you place and what is your expected profit from this trade?
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Risk Management For Forex Trading Beginners Tips For Managing Risk In Forex Trading For Beginners
Authors: J.r. Bosanko
1st Edition
1542317657, 978-1542317658
