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Q1c. 8 Points An Investor wants to build a zero-cost portfolio. His portfolio contains the following assets: One share of stock he bought at $85.
Q1c. 8 Points An Investor wants to build a zero-cost portfolio. His portfolio contains the following assets: One share of stock he bought at $85. One long put option with strike price of $80, one year to maturity, and cost of $5.10 One short call option with strike price of $90, one year to maturity and cost of $6.90 The continuously compounded interest rate is 5% How can he make it a zero-cost portfolio using a bond? Explain your response
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