Suppose you, as a speculator, expect that the British pound will appreciate or depreciate substantially. Therefore, you long a straddle. Find out the profit or loss per contract (use the following information).

Call option premium: $0.03/, Put option premium: $0.025/

Strike price = $1.5/

One option contract size: 35,000.00

At expiration, the spot exchange rate is $1.3/

a.
$5,075

b.
$6,125

c.
$6,745

d.
$7,002

Question

Suppose you, as a speculator, expect that the British pound will appreciate or depreciate substantially. Therefore, you long a straddle. Find out the profit or loss per contract (use the following information).

Call option premium: $0.03/, Put option premium: $0.025/
Strike price = $1.5/
One option contract size: 35,000.00
At expiration, the spot exchange rate is $1.3/

	a.	$5,075
	b.	$6,125
	c.	$6,745
	d.	$7,002

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Question

Suppose you, as a speculator, expect that the British pound will appreciate or depreciate substantially. Therefore, you long a straddle. Find out the profit or

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