Question
JD is currently trading at $62.35.One-year European Call and Put options on JD with a strike price of $60 are trading at $5.35 and $1.57
JD is currently trading at $62.35.One-year European Call and Put options on JD with a strike price of $60 are trading at $5.35 and $1.57 respectively.The continuously compounded risk-free rate is 3.0%.You suspect the options are mispriced and would like to set up an arbitrage trading strategy to profit from the mispricing.How much money can you make per unit of trade?Assume there are no transaction costs other than the option premiums.
Enter your answer to 2 decimal places eg if your answer is 0.457 enter as 0.46.If your answer is 0.4 enter as 0.40
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