3 Here is a table of call option quotes on Nike (NKE) from CBOT on 26 February 2019.On that day NKE traded at $85.00Recall that these quotes are per share but listed options are written on 1O0 shares.The options expire June 21 2019.BidAskStrike$6.40$6.60 $82.50$4.90$5.05 $85.00$3.60$3.75 $87.50Suppose that you purchase the $82.50 strike price call and sell the $87.50 strike call.Ignoring commissions, the maximum profit of your strategy is closest to:$500$360$200$400

The call gives right to buy the stock on expiration but no obligation to do that and there is…

Answered: Here is a table of call option quotes…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The following table lists the options on Amazon shares in January 2018 when Amazon stock was selling for $1,210. Exercise Price $1,210 1,310 1,410 Expiration Date July 2018 Call Price $161.90 104.10 62.65 a. Call option with exercise price of $1,210 b. Put option with exercise price of $1,210 C. Call option with exercise price of $1,310 d. Put option with exercise price of $1,310 e. Call option with exercise price of $1,410 f. Put option with exercise price of $1,410 Use the data in the table to calculate the payoff and the profits for investments in each of the following July maturity options, assuming that the stock price on the expiration date is $1,305. (Negative amounts should be indicated by a minus sign. Round your "Profit" answers to 2 decimal places.) Put Price $53.56 96.10 156.15 Payoff Profit
The following table lists prices of Amazon options in January 2018 when Amazon stock was selling for $1,400. Expiration Date April 2018. July 2018 January 2019 Exercise Price $1,200 1,300 1,400 $1,200 1,300 1,400 $1,200 1,300 1,400 Call Price Put Price $132.70 $31.10 73.20 70.10 33.00 134.20 $53.55 $161.70 104.00 62.55 $210.00 155.35 112.00 96.00 156.05 $88.05 133.25 190.00 Suppose that by January 2019, the price of Amazon could either rise from its January 2018 level to $1,400 × 1.20 = $1,680.00 or fall to $1,400/1.20 $1,166.67. a. Percentage return b. Percentage return C. Which is riskier: the stock or the option? a. What would be your percentage return on a January expiration call option with an exercise price of $1,400 if the stock price rose? (Round your answer to 2 decimal places.) b. What would be your percentage return if the stock price fell? (Negative value should be indicated by a minus sign.) c. Which is riskier: the stock or the option? % %
The following table lists prices of Amazon options in January 2018 when Amazon stock was selling for $1,200. Exercise Price Expiration Date April 2018 Call Price Put Price $ 31.10 $1,200 1,300 1,400 $1,200 1,300 1,400 $1,200 1,300 1,400 $132.70 73.20 70.10 134.20 $ 53.55 96.00 33.00 July 2018 $161.70 104.00 62.55 156.05 January 2019 $210.00 $ 88.05 155.35 133.25 112.00 190.00 Suppose that by January 2019, the price of Amazon could either rise from its January 2018 level to $1,200 × 1.25 = $1,500.00 or fall to $1,200/1.25 = $960.00. a. What would be your percentage return on a January expiration call option with an exercise price of $1,200 if the stock price rose? (Round your answer to 2 decimal places.) b. What would be your percentage return if the stock price fell? (Negative value should be indicated by a minus sign.) c. Which is riskier: the stock or the option? a. Percentage return b. Percentage return Which is riskier: the stock or the option? % (100) % Option C.
Refer to Figure 15.1, which lists the prices of various Microsoft options. Use the data in the figure to calculate the payoff and the profit/loss for investments in each of the following November 2019 expiration options on a single share, assuming that the stock price on the expiration date is $143. (Loss amounts should be indicated by a minus sign. Round "Profit/Loss" to 2 decimal places.)
The following table lists prices of Amazon options in January 2018 when Amazon stock was selling for $1,300. Exercise Expiration Date April 2018 Price Call Price $132.70 73.20 33.00 $161.70 Put Price $1,200 $ 31.10 70.10 134.20 $ 53.55 1,300 1,400 $1,200 1,300 1,400 $1,200 1,300 1,400 July 2018 104.00 96.00 62.55 156.05 January 2019 $210.00 $ 88.05 155.35 133.25 112.00 190.00 Suppose that by January 2019, the price of Amazon could either rise from its January 2018 level to $1,300 × 1.20 = $1,560.00 or fall to $1,300/1.20 = $1,083.33. a. What would be your percentage return on a January expiration call option with an exercise price of $1,300 if the stock price rose? (Round your answer to 2 decimal places.) b. What would be your percentage return if the stock price fell? (Negative value should be indicated by a minus sign.) c. Which is riskier: the stock or the option? Percentage return % а. b. Percentage return % c. Which is riskier: the stock or the option?
Here is a table of call option quotes on Nike (NKE) from CBOT on 2 March 2020 On that day NKE traded at $89.59 The options expire June 19 2020. Bid Ask Strike $7.90 $8.05 $87.50 $6.55 $6.70 $90.00 $5.30 $5.50 $92.50 Suppose that you purchase the $87.50 strike price call and sell the $92.50 strike call. Ignoring commissions, what does your strategy cost today Recall that these quotes are per share but listed options are written on 100 shares. $300 $240 $275 $225
Required: Refer to Figure 15.1, which lists the prices of various Microsoft options. Use the data in the figure to calculate the payoff and the profit/loss for investments in each of the following December 2019 expiration options on a single share, assuming that the stock price on the expiration date is $137. (Loss amounts should be indicated by a minus sign. Round "Profit/Loss" to 2 decimal places.) a. Call option, X = 135 b. Put option, X = 135 es c. Call option, X = 145 d. Put option, X = 145 Payoff Profit/Loss
Required: Refer to Figure 15.1, which lists the prices of various Microsoft options. Use the data in the figure to calculate the payoff and the profit/loss for investments in each of the following November 2019 expiration options on a single share, assuming that the stock price on the expiration date is $138. (Loss amounts should be indicated by a minus sign. Round "Profit/Loss" to 2 decimal places.) ✓ Answer is complete but not entirely correct. Payoff Profit/Loss a. Call option, X = 135 $ 3.00 $ (3.78) b. Put option, X = 135 $ 0.00 $ (1.89) c. Call option, X = 140 $ 0.00 $ (1.50) X d. Put option, X = 140 $ 7.00 $ 0.35 x
Calculate the company’s forward P/E ratio
1
answer must be in table format or i will give down vote
Consider a particular stock with call and put options. The date is January 12, and the price of the stock is P185. The table below shows the closing prices of four options, two of which expire in February and May and have exercise prices of 175 and 205, respectively. The February options will expire on February 16th, while the May options will expire on October 20th. These specific selections are of the American style. Exercise Price February Calls May Calls February Puts May Puts 175 25.00 33.50 18.00 26.75 205 18.20 20.22 25.25 32.18 Consider the February call. Explain (with supporting calculations) that the option holder has no reason the option right now. When is the purchased justified? Explain (with supporting calculations) that, given February call at an exercise price is less likely also to be exercised. Suppose that the option buyer has an alternative to purchase May call instead of February call. Explain why May options are more…

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Here is a table of call option quotes on Nike (NKE) from CBOT on 26 February 2019. On that day NKE traded at $85.00 Recall that these quotes are per share but listed options are written on 100 shares. The options expire June 21 2019.