no risk free rate

Current quotes on 1 June 2017 Date Stock A $10.00 Call Jun 17 Stock A $10.00 Put Jun 17 Stock A 1 June 2017 $0.20 $0.20 $10.00 The days to maturity for the options contracts are 30 days (including the current day). (a) Given the above scenario, please create a synthetic long "Stock A, using options. What is the effective price at which you long this synthetic Stock A? Describe your strategy in detail. (5 marks) (b) If the stock A rises to $11.00, please illustrate the resulting payoff of conversion or reverse conversion strategy using the cashflows of the current day and maturity day, in both the stock and option markets. You may assume there is no transaction cost in this case. (5 marks) (c) Please draw the profit/loss of your strategy (in dotted lines) and the result of your net position (in continuous line) in a graph. Please label each strategy well. (5 marks) (d) Stock A is trading at $10.00. A 30 day $10.00 call has a delta of 0.5. If you have 100,000 shares of this stock, how would you hedge your long stock position fully? Please describe your strategy in detail. The contract size for each option contract is 100 shares. (5 marks) Current quotes on 1 June 2017 Date Stock A $10.00 Call Jun 17 Stock A $10.00 Put Jun 17 Stock A 1 June 2017 $0.20 $0.20 $10.00 The days to maturity for the options contracts are 30 days (including the current day). (a) Given the above scenario, please create a synthetic long "Stock A, using options. What is the effective price at which you long this synthetic Stock A? Describe your strategy in detail. (5 marks) (b) If the stock A rises to $11.00, please illustrate the resulting payoff of conversion or reverse conversion strategy using the cashflows of the current day and maturity day, in both the stock and option markets. You may assume there is no transaction cost in this case. (5 marks) (c) Please draw the profit/loss of your strategy (in dotted lines) and the result of your net position (in continuous line) in a graph. Please label each strategy well. (5 marks) (d) Stock A is trading at $10.00. A 30 day $10.00 call has a delta of 0.5. If you have 100,000 shares of this stock, how would you hedge your long stock position fully? Please describe your strategy in detail. The contract size for each option contract is 100 shares