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Please answer all of them with all explanations A.3. Consider the following investment strategy: buy simultaneously a call and a put option both with exercise

image text in transcribedPlease answer all of them with all explanations

A.3. Consider the following investment strategy: buy simultaneously a call and a put option both with exercise price of 100. Both options are on the same underlying asset and with the same maturity. (a) Draw a diagram of the net profit. (b) This strategy is called Straddle and represents a bet on volatility. Explain briefly the nature of this bet

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