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we consider an investor with $5,000 to invest. Assume the spot price in 12 months is $100. Calculate the amount the investor will make spending
we consider an investor with $5,000 to invest. Assume the spot price in 12 months is $100. Calculate the amount the investor will make spending the $5,000 to buy shares of stock, spending the $5,000 to buy puts with a strike of $100, or spending the $5,000 to buy calls with a strike of $100? Based on this analysis, Why do investors use options? what is the advantage of using options?
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