Assume you are an option buyer. The strike price is $44 and the option premium is $3. You will pay $ 44 when you exercise the option. Select one: True or False?
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Assume you are an option buyer. The strike price is $44 and the option premium is $3. You will pay $ 44 when you exercise the option. Select one: True or False?
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- Assume you are an option buyer. Strike price is $44 and option premium is $3. You will pay \$44 when you exercise the optionThe investor Y decides to: Buy a call option for $5 with $200 as strike price Sell a put option for $10 with $100 as 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 $260 c)Represent the results of the investor for both cases a) and b) in the same figureAn investor buys a put option at a premium of $4.6 with an exercise price of $30. At what stock price will the investor break even on the purchase of the put option?
- Suppose you combine two option contracts as follows. You buy a call option on a stock with an exercise price of $65 for a premium of 9$. At the same time you sell a call option on the same stock with an exercise price of $75 for a premium of $4. Both calls expire at the same time. The stock sells currently at $72. Answer the following questions about this investment strategy: 1. Determinethevalueatexpiration(thepayoffs)andtheprofitunderthefollowingoutcomes: a. The price of the stock at expiration is $78b. The price of the stock at expiration is $69c. Thepriceofthestockatexpirationis$62 2. Determine the following:a. The maximum profit b. The maximum loss 3. Determinethebreakevenstockpriceatexpiration(thestockpriceforwhichyourstrategydeliversno profit and no loss). 4. Depictthepayoffandprofitdiagramsofyourinvestmentstrategy.Suppose that you purchased a call option on the S&P 100 Index. The option has an exercise price of 1,680, and the index is now at 1,720. What will happen when you exercise the option?An investor makes the following three investments: (i) the purchase of a stock for £38(ii) the purchase of a put option for £0.50 with a strike price of £35 and (iii) the sale ofa call option (ie. writing a call option) for £0.50 with a strike price of £40 .(a)What is the intrinsic value and the time value of the put option, What is the maximum profit and loss for this position?
- 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 figureConsider a call option selling for Ksh.14 in which the exercise price is Ksh.162 and the price of the underlying is Ksh.164. Determine the value at expiration and the profit for a buyer under the following outcomes: The price of the underlying at expiration is Ksh.164. The price of the underlying at expiration is Ksh.158.Assume you are a speculator who purchased a IPE Brent Crude call option contract at an exercise price of $52 by paying a premium of $2. If the price of the underlying asset moves to $ 48 what is your maximum loss or gain ? If the price of the underlying asset moves to $ 56 what is your maximum loss or gain ?
- A. An option is trading at $5.03. If it has a delta of -.56, what would the price of the option be if the underlying increases by $.75? What would the price of the option be if the underlying decreases by $.55? B. What type of option is this and how? C. With a delta of -.56, is this option ITM, ATM or OTM and how?An investor makes the following three investments: (i) the purchase of a stock for £38(ii) the purchase of a put option for £0.50 with a strike price of £35 and (iii) the sale ofa call option (ie. writing a call option) for £0.50 with a strike price of £40 .(a) What is the intrinsic value and the time value of the put option and what is the maximum profit and loss for this position?An investor makes the following three investments: (i) the purchase of a stock for £38(ii) the purchase of a put option for £0.50 with a strike price of £35 and (iii) the sale ofa call option (ie. writing a call option) for £0.50 with a strike price of £40 .(a) What is the intrinsic value and the time value of the put option.(b) What is the maximum profit and loss for this position? help me with part (b) please.