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Investor owns a house and considers writing an option according to which he will sell this house with a price of 1,000,000 PLN. Premium is
Investor owns a house and considers writing an option according to which he will sell this house with a price of 1,000,000 PLN. Premium is 8,000 PLN. What option should he write? What will be his position? When this option will be in the money and what is break-even point for investor? Results: in the money when S(t) > 1,000,000 PLN/ bep -1,008,000 PLN [1,5 pt.]
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