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Posted on Sep 06, 2024

Please refer to HW4_data.doc for quotes on Intel stock options. Consider the following positions on the Intel stock. For each of the positions choose the

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Please refer to HW4_data.doc for quotes on Intel stock options. Consider the following positions on the Intel stock. For each of the positions choose the strike X = $50. Choose May option. a. Long 1 call contract. b. Short 1 put. c. Long 1 call + short 1 put. d. Long 1 call + long 1 put. e. Long 1 call with strike $50 and short 1 call with strike $52.5. Assume that you enter and close the positions at the mid point of bid-ask spread. For each position (a-e) answer the following questions. Assume that you trade each contract on March 17 (i.e. enter the positions). 1. Close out your positions on March 24. Calculate your net dollar gain or loss. 2. Now assume that you exercise options on March 24. For each position compute your net gain or loss. 3. For each position draw the payoff diagram, marking the strikes and the stock price on March 24 clearly, as well as your payoff. March 17 INTC (INTEL CORP) 49.655 +5.045 Calls Last Sale Open Int Puts INTC 49.000 INTC 50.000 Last Net Bid Ask Vol Open 3.75 -1.6 4.05 4.2 157 1703 5 -0.875 4.5 4.65 461 8310 INTC 49.000 INTC 50.000 Last Net Sale Net Bid Ask Vol Open Int Maturity Bid A 4.75 +0.8 4.7 4.9 53 513 20 Apr 49 3.89 +0.415 4.2 4.35 438 2.95 +0.525 2.97 3.1 1,152 5103 20 Apr 52.5 1.99 +0.395 1.95 2 1,030 7530 20 Apr 55 6.85 +0.95 6.65 6.9 55 21 20 May 47.5 INTC 52.500 INTC 55.000 INTC 55.000 7.35 -1.9 7.25 785 8346 -1.25 4.7 4.95 129 166 INTC 47.500 4.85 INTC 47.500 INTC 50.000 S *0.53 5.25 5.5 1,250 425 20 May 50 INTC 50.000 5.61 -1.79 5.85 6.1 430 2000 INTC 52.500 3.8 +0.225 4.05 4.25 195 1919 20 May 52.5 7.4 -1.425 7.15 7.35 27 INTC 52.500 4262 INTC 55.000 3.05 +0.375 3 3.2 394 3402 20 May 55 INTC 55.000 8.12 -2.28 8.55 8.8 18 3154 March 24 INTC (INTEL CORP) 52.4 +2.82 Calls Net Maturity Bid Ask Vol Open Int Strike Puts Last Sale Net Bid Open Int INTC 49.000 1.79 2.25 2,12 2003 INTC 50.000 5.8 +2.6 4.9 7 35 4.42 +1.725 4.3 5.1 648 3.3 +1.64 2.87 4 817 1160 20 Apr 49 INTC 49.000 2779 20 Apr 50 INTC 50.000 6500 20 Apr 52.5 INTC 52.500 2.05 2.32 3.46 -1.7 -1.93 -2.215 INTC 52.500 3 3.9 187 5771 INTC 55.000 INTC 47.500 INTC 50.000 INTC 52.500 INTC 55.000 2.3 +1.38 1.67 2.38 2,085 7.5 +2.5 6.8 8.6 17 5.8 +2.175 5.15 6.1 97 4.45 +1.985 3.7 5 790 3.15 +1.59 2.5 3.35 1,231 9491 20 Apr 55 INTC 55.000 274 20 May 47.5 INTC 47.500 2206 20 May 50 INTC 50.000 3016 20 May 52.5 INTC 52.500 6528 20 May 55 INTC 55.000 4.55 -2.85 2.82 -1.43 1.7 3.2 3.47 -1.905 2.95 4.76 -2.015 3.4 5.3 4247 5.65 -2.75 4.45 6.2 738 2847 Please refer to HW4_data.doc for quotes on Intel stock options. Consider the following positions on the Intel stock. For each of the positions choose the strike X = $50. Choose May option. a. Long 1 call contract. b. Short 1 put. c. Long 1 call + short 1 put. d. Long 1 call + long 1 put. e. Long 1 call with strike $50 and short 1 call with strike $52.5. Assume that you enter and close the positions at the mid point of bid-ask spread. For each position (a-e) answer the following questions. Assume that you trade each contract on March 17 (i.e. enter the positions). 1. Close out your positions on March 24. Calculate your net dollar gain or loss. 2. Now assume that you exercise options on March 24. For each position compute your net gain or loss. 3. For each position draw the payoff diagram, marking the strikes and the stock price on March 24 clearly, as well as your payoff. March 17 INTC (INTEL CORP) 49.655 +5.045 Calls Last Sale Open Int Puts INTC 49.000 INTC 50.000 Last Net Bid Ask Vol Open 3.75 -1.6 4.05 4.2 157 1703 5 -0.875 4.5 4.65 461 8310 INTC 49.000 INTC 50.000 Last Net Sale Net Bid Ask Vol Open Int Maturity Bid A 4.75 +0.8 4.7 4.9 53 513 20 Apr 49 3.89 +0.415 4.2 4.35 438 2.95 +0.525 2.97 3.1 1,152 5103 20 Apr 52.5 1.99 +0.395 1.95 2 1,030 7530 20 Apr 55 6.85 +0.95 6.65 6.9 55 21 20 May 47.5 INTC 52.500 INTC 55.000 INTC 55.000 7.35 -1.9 7.25 785 8346 -1.25 4.7 4.95 129 166 INTC 47.500 4.85 INTC 47.500 INTC 50.000 S *0.53 5.25 5.5 1,250 425 20 May 50 INTC 50.000 5.61 -1.79 5.85 6.1 430 2000 INTC 52.500 3.8 +0.225 4.05 4.25 195 1919 20 May 52.5 7.4 -1.425 7.15 7.35 27 INTC 52.500 4262 INTC 55.000 3.05 +0.375 3 3.2 394 3402 20 May 55 INTC 55.000 8.12 -2.28 8.55 8.8 18 3154 March 24 INTC (INTEL CORP) 52.4 +2.82 Calls Net Maturity Bid Ask Vol Open Int Strike Puts Last Sale Net Bid Open Int INTC 49.000 1.79 2.25 2,12 2003 INTC 50.000 5.8 +2.6 4.9 7 35 4.42 +1.725 4.3 5.1 648 3.3 +1.64 2.87 4 817 1160 20 Apr 49 INTC 49.000 2779 20 Apr 50 INTC 50.000 6500 20 Apr 52.5 INTC 52.500 2.05 2.32 3.46 -1.7 -1.93 -2.215 INTC 52.500 3 3.9 187 5771 INTC 55.000 INTC 47.500 INTC 50.000 INTC 52.500 INTC 55.000 2.3 +1.38 1.67 2.38 2,085 7.5 +2.5 6.8 8.6 17 5.8 +2.175 5.15 6.1 97 4.45 +1.985 3.7 5 790 3.15 +1.59 2.5 3.35 1,231 9491 20 Apr 55 INTC 55.000 274 20 May 47.5 INTC 47.500 2206 20 May 50 INTC 50.000 3016 20 May 52.5 INTC 52.500 6528 20 May 55 INTC 55.000 4.55 -2.85 2.82 -1.43 1.7 3.2 3.47 -1.905 2.95 4.76 -2.015 3.4 5.3 4247 5.65 -2.75 4.45 6.2 738 2847