Question
Jack received 1,000 shares of IBM stock from his parents before Christmas. Today is Dec.26 and the stock is selling for $50 a share. The
Jack received 1,000 shares of IBM stock from his parents before Christmas. Today is Dec.26 and the stock is selling for $50 a share. The March call options on IBM shares with strike price $55 are currently selling for $5 each. The March put options on IBM stocks with strike price $45 sell for $2 each. While holding IBM shares, Jack writes 10 contracts of March 55 call options and buys 5 contracts of March 45 put options.
What is the value of his portfolio if IBM trades at $40 and $65, respectively?
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Taxation Of Individuals And Business Entities 2015
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver
6th Edition
978-1259206955, 1259206955, 77862368, 978-0077862367
