Question
You took a long position on a stock for $100 and a put option on it for $10 with a strike price of $95. You
You took a long position on a stock for $100 and a put option on it for $10 with a strike price of $95. You took a short position on a call option on it for $15.00 with a strike price of $100.
a. Find out how much you invested to take long position in the stock & the put option and short position in the call option.
b. Find out the payoffs and profits of your position at expiration for the following prices:
i. $80, ii. $90, iii. $100 and iv. $120
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Derivative Pricing
Authors: Ambrose Lo
1st Edition
0367734214, 978-0367734213
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