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Two years ago you sold a call option on stock ZYX, with a strike price of $30, which expires today. At that time you
Two years ago you sold a call option on stock ZYX, with a strike price of $30, which expires today. At that time you also bought a share of stock ZYX. Today the share price of ZYX is $34. What is the payoff of your portfolio today? The stock of company ABC is currently trading at $130 per share. The one-year risk-free interest rate is 5% per year (this is an effective interest rate). A one-year European call option on ABC with an exercise price of $130 is currently trading at $11. What must be the price of a one-year European put option on ABC with an exercise price of $130?
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