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The current spot price of an ounce of gold is $1875. At an exercise price of $2000 and with a maturity of 3 months, you
The current spot price of an ounce of gold is $1875. At an exercise price of $2000 and with a maturity of 3 months, you simultaneously buy a call and a put option on an ounce of gold. According to analysts reports the gold price is expected either to fall to $1650 or rise to $2350 three months later. Assuming a risk free rate of 2% calculate the call price and put price.
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