You bought 100 strike $30 American put options for $0.08 each exactly 282 days ago. Today you exercised the options while the underlying asset was trading for $29.77/share. What is your net annualized ROI on this investment? Please submit your answer so that 5 is used to represent 5% net returns
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- A stock is trading at $80 per share. The stock is expected to have a yearend dividend of $4 per share (D1 = $4), and it is expected to grow at some constant rate, g, throughout time. The stock’s required rate of return is 14% (assume the market is in equilibrium with the required return equal to the expected return). What is your forecast of gL?Y2 You bought 100 strike $30 American put options for $0.08 each exactly 270 days ago. Today you exercised the options while the underlying asset was trading for $29.82/share. What is your net annualized ROI on this investment? Please submit your answer so that 5 is used to represent 5% net returnsStanton Company stock is trading for 50 in a two‑time period environment, so that each relevant time period is 6 months. The stock might increase by exactly 20% in just one period or perhaps in both periods. Of course, the stock might not increase in either period. If the stock price does not increase in a given period, it will decline by 16.67 percent in that particular period. One-year options with an exercise price equal to 60 are trading on this stock. The annual riskless rate of return equals 0. a. What is the value of a put in this environment? b. What is the probability (risk-neutral probability) implied in this framework that the Stanton Company stock price will exceed 40 when options expire?
- A stock priced at $65 has three-month calls and puts with an exercise price of $55 available. The calls have a premium of $3.91, and the puts cost $1.6. The risk-free rate is 1.6%. If the put options are mispriced, what is the profit per option assuming no transaction costs? Bring out 4 decimal placesSuppose you had just gone long (purchased) on lot of Syarikat XYZ stock at a price of RM 15.00 each, for a total investment of RM 15,000. You believe this stock has long term potential but wish to protect yourself from any short-term downside movement in price. Suppose 3-month, at-the-money put options on Syarikat XYZ stocks are being quoted at RM 0.15 or 15 sen each or RM 150 per lot (RM 0.15 x 1,000).a. What would be the appropriate options strategy to hedge the long stockposition? b. Show (in a table) the payoff to the combined position for a given range ofstocks prices at options maturity in 3-months. c. Draw the payoff profile of combined positions.Based on five years of monthly data, you derive the following information forthe companies listed: Company SDi rm Padma 11.10% 0.82 Meghna 12.60% 0.63 Jamuna 6.60% 0.45 Karnafully 9.70% 0.70 SD on Market 7.60% 1.00 Assuming a risk-free rate of 9% and expected return for the market portfolio is 16 % compute the expected (required) return for all the stocks.
- On January 1, 1997, a stock portfolio is worth $100 thousand. On September 30, 1997, $8.9 thousand is withdrawn from the portfolio, and immediately after this withdrawal the portfolio has a value of $105 thousand. Twelve months later, the value of the portfolio is $108 thousand, and the investor adds $3 thousand worth of stock to his portfolio. On December 31, 1998, the portfolio is worth $100 thousand. Over the two-year period, the annual time-weighted rate of return is X and annual dollar-weighted rate of return is Y. Find |X-Y|A stock is selling today for $110. The stock has an annual volatility of 64 percent and the annual risk-free rate is 7 percent. Calculate how much the current stock price would need to change for the purchaser of the put option to break even in one year. Calculate the level of volatility that would make a $95 call option sell for $30. (Use Goal Seek or Solver). Calculate the level of volatility that would make a $95 put option sell for $8. (Use Goal Seek or Solver). Please show work in excel.Year-to-date, Yum Brands had earned a 4.80 percent return. During the same time period, Raytheon earned 5.13 percent and Coca-Cola earned −0.64 percent.If you have a portfolio made up of 40 percent Yum Brands, 30 percent Raytheon, and 30 percent Coca-Cola, what is your portfolio return? (Round your answer to 2 decimal places.) Portfolio return: ____.__%
- Both a call and a put currently are traded on stock XYZ; both have strike prices of $50 and expirations of 6 months. What will be the profit to an investor who buys the call for $4 in the following scenarios for stock prices in 6 months? What will be the profit in each scenario to an investor who buys the put for $6? $40 $45 $50 $55 $60The spot price of a stock is 70. The stock pays continuous dividends at a rate of 2% annually. The continuously compounded risk-free interest rate is 6%. You notice a 5-month forward price in the market that would allow you to perform a reverse cash-and-carry arbitrage and make a profit of 2.35 on one forward contract in 5 months. What is the forward price you found in the market?Teh stocks is currently selling for $15.25 par share and its noncallable $1000 par value, 20 year, 7.25% conds with semiannual payment are selling for $875.00. The beta is 1.25, the yield on a six month T-bill is 3.50% on yield of 20 year TBond is 5.50%. The required return on the stock market is 11.5% by the market and has a average annual return of 14.50% during the past 5 years. The firms tax is 40%. using CAPM what is the firms cost of common stock? (13.65%, 11.73%, 11.15%, 13% or 12.32%)
