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Undertake an option strategy that consists of: - Sell 1 Put with stike K =75; - Buy 3 Puts with strike K = 85; -
Undertake an option strategy that consists of:
- Sell 1 Put with stike K =75; - Buy 3 Puts with strike K = 85; - Sell 2 Puts with strike K = 90.
1.) Plot the resulting net payoff as a function of S(T).
2.) Is the net initial premium (i.e. original cost of the strategy) positive, negative or zero (or underdetermined)? Explain your answer.
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