Question
You are cautiously bullish on the common stock of the Wildwood Corporation over the next several months. The current price of the stock is $63
You are cautiously bullish on the common stock of the Wildwood Corporation over the next several months. The current price of the stock is $63 per share. You want to establish a bullish money spread to help limit the cost of your option position. You find the following option quotes:
| Wildwood Corporation | Underlying Stock Price: $63.00 | ||
| Expiration | Strike | Call | Put |
|---|---|---|---|
| June | $ 58.00 | $ 9.80 | $ 3.30 |
| June | $ 63.00 | $ 5.15 | $ 4.30 |
| June | $ 68.00 | $ 2.65 | $ 8.80 |
Ignoring commissions, the cost to establish the bull money spread with calls would be?
You buy one Huge-Packing August 50 call contract and one Huge-Packing August 50 put contract. The call premium is $1.65, and the put premium is $4.90. Your highest potential loss from this position is?
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Advanced Accounting
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng
11th edition
538480289, 978-0538480284
