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You are working on the options trading desk of FINM Investment Bank. Three-month European call and puts on stock BUSN with strike $25 are selling
You are working on the options trading desk of FINM Investment Bank. Three-month European call and puts on stock BUSN with strike $25 are selling for $1.5 and $6.8, respectively. BUSN is currently trading at $20 and does not pay dividends. The interest rate is 3% p.a.c.c.Are you able to make an immediate and riskless profit without any out-of-pocket expenses? If so, show all steps and calculations for the entire duration of your strategy.
that is all information, thanks.
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