A short strangle was initiated with a strike price for the call at $70 and the strike price of the put at $80. The premium recieved for writing/selling the put was $12 and the premium received for writing/selling the call was $15. Within what range must the stock be at expiration to not lose money on this strangle?

Q: e price of a stock is $44 per share, and the October put with an exercise price of $45 is selling…

A: The put option gives opportunity to sell the stock but no obligation to sell the stock on expiration…

Q: You purchase a call with a strike of K-22 at a premium of 1.73 and you purchase a put with a strike…

A: Profit on Call option= Max(St-K,0)-Premium=Max(15.31-22,0)-1.73=-1.73Profit on Put Option=…

Q: You purchased two $35 call contracts at $3.40 per option. You exercised the option on expiration day…

A: Call Option is a financial derivative contract which givers option buyer a right not obligation to…

Q: Please answer both questions What is the risk premium for the stock in the table below? The risk…

A: Risk premium of a stock = Beta of the stock x Market Risk premiumBeta of the stock = 1.05Market Risk…

Q: ou own one ABC October 50 put. ABC stock is now trading at $53 per share. Which statement is true?…

A: Options trading is the agreement under which the parties are allowed to buy and sell he instruments…

Q: An investor purchases a stock for $47 and a put for $0.95 with a strike price of $45. The investor…

A: Maximum profit is the difference between the strike price of the call sold and the purchase…

Q: You shorted a stock at $50 a share. If the maintenance margin is 35%, at what price level will you…

A: price of stock=$50Initial margin=50%Maintenance margin=35%

Q: You are given the following information concerning the trades made on a particular stock. Calculate…

A: Stock return refers to the rate of return earn by an investor on the amount invested during a period…

Q: A put with 1-year to maturity is written on a stock. The current underlying stock price is $20. The…

A: The put-call parity refers to the relationship between the prices of the call and the put options…

Q: of a $35 strike call? Assume S = $38.50, = 0.25, r = 0.06, the stock pays no dividend andthe option…

A: When a derivatives contract is exercised, the strike value is the cost at which it could be…

Q: A 1-year call on a stock with strike $30 costs $3; a 1-year put on the same stock with strike $30…

A: Variables in the question:1 year call option:Strike price=$30Call premium=$31 year put-option:Strike…

Q: An investor buys a call at a premium of $4.4 with an exercise price of $40. At what stock price will…

A: A financial instrument that provides the opportunity to the buyer and seller to purchase and sell…

Q: Whats the profit of the "Straddle" when stock price is $15, $20, $25, $30, $35, $40, $45, $50, $55,…

A: In the given question we require to calculate the profit of the "Straddle" when stock price is $15,…

Q: You bought a $50 strike call option on a stock XYZ for $8.20 and then sold/wrote a $65 call option…

A: In this question we need to calculate the amount we made from buying call option and selling call…

Q: Assuming you have a margin account verage you wish to sell short a stock currently priced at $25 per…

A: Given that             Leverage  Ratio =1.76           Stock Price =$ 25 per share           Equity…

Q: An investor has a short position in both a call and a put options on the same share of stock with…

A: Exercise price of call = $40Exercise price of put = $35Call premium = $2Put premium = $1To find:…

Q: Suppose that the premiums of an American call and put are C = $8.0/share and P = $7.5/share. The…

A: Option give opportunity to buy or sell stock on expiration but there is no obligation to do that.

Q: Given the following information, price of a stock: strike price of a six-month call: market price of…

A: A covered call refers to the strategy used by investors where they buy a stock while at the same…

Q: An investor purchases a call for CL0 = $3.00 with a strike of X = $40 and sells a call for CH0 =…

A: A bull call spread is an options trading strategy that involves buying a call option with a lower…

Q: 8. Two days before expiration date, Patty wants to sell a Call with strike price $100; i.e. she…

A: The lower Bound equation = S0 - K(1+r365)t Where S0 = Current stock price K = Strike Price r =…

Q: A stock is currently selling for $40.00 a share. What is the gain or loss on the following…

A: Long position means that when prices when increase from the current position and short position is…

Q: 6. Assume you own Apple stock. The current price is $100. Assume a strike of $110 and expiration of…

A: A covered call strategy involves the use of call options to generate some income in the form of a…

Q: A stock is currently trading at $83. A long straddle was purhcased with a strike price of $85. The…

A: long straddle: long call and long put at same strike price. given, stock price = $83 strike price =…

Q: A call option on MassComputer Corp. is trading with a strike price of $100 and an expiration date on…

A: The objective of this question is to calculate the net profit or loss from buying a call option on…

Q: Consider the following Put Option: May 50 trading at $3.15/share May is the expiration  50 is the…

A: In case of Put option, Buyer will exercise the put option only if strike price is greater than stock…

Q: None

A: Reason:A Binomial tree with a factor of appreciation greater than 1 (in this case 1.4) indicates an…

Q: Given the following information, price of a stock: strike price of a six-month call: market price of…

A: An option is a type of financial instrument that is based on the value of underlying securities,…

Q: Consider a December 310 call and a December 310 put, both on a stock that is currently selling for…

A: Call option is a contract in which the buyer of the option has the right but not the obligation to…

Q: You shorted a call option on Intuit stock with a strike price of $34. When you sold (wrote) the…

A: Strike Price of $34 Premium received is $6 Time to expiry is 3 months To Find: Payoff  profits

Q: A.K. Scott’s stock is selling for $37 a share. A 3-month call on this stock with a strike price of…

A: The put-call parity is a term used to describe the relationship between call and put options in…

Q: a) An investor wants to benefit from META price drops but does not want to lose more than $30 on the…

A: A call option gives the right but not the obligation to buy at the strike price.  The formula to…

Q: Given the following information, price of a stock: strike price of a six-month call: market price of…

A: An option is a type of financial instrument that is based on the value of underlying securities,…

Q: Whats the profit of the "Bearish Put Spread" when stock price is $25, $30, $35, $40, $45, $50, $55,…

A: In the given question we need to compute the profit of the "Bearish Put Spread"

Q: Given the following information, price of a stock: strike price of a six-month call: market price of…

A: An option is a type of financial instrument that is based on the value of underlying securities,…