You buy a call option on Amazon with a strike price of $2000.0 You also buy a Put option with a strike price of $2000.0 , you sell a put options with a strike price of $1500.0 and you also sell a call option wih a strike of 1400.0 You a have just created a(n) Multiple Choice Bull spread Iron condor Collar

You buy a call option on Amazon with a strike price of $2000.0 You also buy a Put option with a strike price of $2000.0 , you sell a put options with a strike price of $1500.0 and you also sell a call option wih a strike of 1400.0 You a have just created a(n) Multiple Choice Bull spread Iron condor Collar

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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No chat GPT You buy a call with a strike price of $33 and sell an identical put. The call has a premium of $8.70 and the put has a premium of $5.53. You also sell a call with a strike price of $36 and buy an identical put. This call has a premium of $7.49 and this put has a premium of $7.17. The risk-free rate in the economy is 3.77%. All 4 options are written on the same underlying asset and expire in exactly one year. If the primary asset is worth $35.48 when the options all expire, what is your net percentage return? Correct Answer is :- 0.0526 Please show steps
sell 1 abc straddle (x = $55) @$6,50 buy 1 abc strangle (x= $50 , x= $60 ) @ $2,00 . options have the same expiration dates. what is the cost of initiating this stratergy ?
Draw the payoff of a call option on an Apple stock with a current price of $90, a strike price of $110 and the cost of the option being $10. Make sure you label your graph properly. (Use Excel to create your graph)
The investor X decides to: Buy a call option for $10 with $100 as strike price Buy a call option for $15 with $90 as the strike price Sell a put option for $10 with $100 as the strike price Buy a put option for $15 with $120 as the strike price a)Calculate the result of the investor if the market price is $60 b)Calculate the result of the investor if the market price is $160 c)Represent the results of the investor for both cases a) and b) in the same figure
M2
You have determined that Tesla (TSLA) is worth $255.00, and that you would be willing to pay no more than $248.50 for it. However, the current bid price is $252.20 and the current ask price is $252.80. You will most likely submit which of the following orders? market order to buy at $255 limit order to buy at $248.50 limit order to sell at $252.80 market buy order at ask price limit order to buy at $252.20
Solve question b
You have taken a long position (bought) in a call option on Google common stock. The option has an exercise price of $525 and Google's stock is currently trading at $510. The option premium is $20. What is the: Break Even Point:
Consider the following option combination: Long $8.50 $9.50 Strangle +1 SK2C95040C +1 SK2P85040c What is the net payoff value of the option combination above (in $/bushel) if the price of Soybeans falls to $8.00/bushel?
PROTECTIVE PUTS Current stock price for Amazon is $810. A put option on Amazon stock with the exercise price of $810 and maturity of 1 month sells at $5 premium. Ignore interests. (1)Plot the payoff against Amazon’s stock price if you buy only Amazon stock What is your max gain? What is your max loss? (2)Plot the payoff against Amazon’s stock price if you buy only put option on Amazon stock What is your max gain? What is your max loss? (3)Plot the payoff against Amazon’s stock price if you buy both Amazon stock and put option on Amazon stock What is your max gain? What is your max loss?
You bought (that is, you are “long”) both a put option and a call option on Strockfoot stock with the same expiration date. The exercise price of the call option is $40 and the exercise price of the put option is $30. Carefully graph the payoff of the combination of options at expiration.
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