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Trader X wants to speculate on the price of an asset by trading in options. Trader X thinks that the price of the asset will
Trader X wants to speculate on the price of an asset by trading in options. Trader X thinks that the price of the asset will not deviate considerably from its current price, S0. Task: Design a strategy constructed with options for Trader X. Provide as much information about this trading strategy as possible. b. Discuss the risks associated with a short option position (call or put), and strategies that can reduce the risks.
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