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The market price of ABC stock has been very volatile and you think this volatility will continue for several weeks. Thus, you decide to purchase
The market price of ABC stock has been very volatile and you think this volatility will continue for several weeks. Thus, you decide to purchase one two-month call option contract on ABC stock with a strike price of $25 and an option price of $1.30. You also purchase one two-month put option on ABC stock with a strike price of $25 and an option price of $.50. What will be your total profit on these positions if the stock price is $25.60 on the day the options expire?
A. | -$180 | |
B. | -$120 | |
C. | -$100 | |
D. | $120 |
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