You bought 3 contracts of 6-month call options on stock XYZ @ $3.86 per call, with strike price of 49.00. Today the call contracts expired when the stock closed at 50.08.
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You bought 3 contracts of 6-month call options on stock XYZ @ $3.86 per call, with strike price of 49.00. Today the call contracts expired when the stock closed at 50.08.
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- The stock of Bedrock Solutions is currently trading at $20.00 per share. The 1-month put option with strike price of 22.62 is currently selling for $4.38. What's the time value of this put option?A stock has a current price of $267. A trader writes 7 naked option contracts on the stock, each contract covering 100 shares. The option price is $2, the strike price is $230, and the time to maturity is 4 months. What is the margin requirement if the options are call options (in $)?You purchase 36 call options on Greshak Corp. to increase returns on your equity portfolio. The three month calls specify the strike price is $48.00 and require a premium of $3.25. If Greshak's stock is trading at $52.00 at the time the options expire, what are your options worth? What was your net profit (in dollars and as an annualized percentage)? What would your profit in dollars and as an annualized percentage had been if the stock instead sold for $51.00/share at expiration? How about $50.00/share?
- A 6-month call option on Meyers Inc.'s stock has a strike price of $45.00 and sells in the market for $8.25. Meyers' current stock price is $51.25. What is the option premium?The stock of Bedrock Solutions is currently trading at $15.00 per share. The 1-month call option with strike price of 25.50 is currently selling for $3.14. What's the time value of this call option?On 1st of May, an investor holds 80 000 shares of a Yahoo. The market price is $87 per share. The investor is interested in hedging against movements in the market over the next month and decides to use the August S&P 500 futures contract. The index is currently at 2800 and one contract is for delivery of $50 times the index. The beta of the stock is 0.75. What is the number of contracts that should be hedged and the type of hedging strategy should the investor follow? Choose the right answer: a. 37 contracts should be longed b. 4 contracts should be longed c. 4 contracts should be shorted d. 37 contracts should be shorted
- You shorted a call option on Intuit stock with a strike price of $38. When you sold (wrote) the option, you received $3. The option will expire in exactly three months' time. a. If the stock is trading at $49 in three months, what will your payoff be? What will your profit be? b. If the stock is trading at $35 in three months, what will your payoff be? What will your profit be? c. Draw a payoff diagram showing the payoff at expiration as a function of the stock price at expiration. d. Redo c, but instead of showing payoffs, show profits. Question content area bottom Part 1 a. The payoff of the short is $ short is $ enter your response here. enter your response here, and the profit of the. Please step by step answer.A stock is expected to pay a dividend of $1 per share in 2 months. An investor purchased a forward contract on the stock at a forward price of $50 some time ago. The contract now has 3 months to its delivery date. The stock is currently trading at $55 and the risk free rate is 4% on a continuously compounded basis. Consider the following statements. I. The price of a forward contract on the stock with 3 months to the delivery date is $54.55 II. The value of the investor’s forward position is $5.50 Which of the following is correct? (No excel pls) a. Statement I is incorrect, Statement II is correct. b. Both statements are correct. c. Both statements are incorrect. d. Statement I is correct, Statement II is incorrect.On July 1, an investor holds 50,000 shares of a certain stock. The market price is $30 per share. The investor is interested in hedging against movements in the market over the next month and decides to use the September Mini S&P 500 futures contract. The index is currently 1,500 and one contract is for delivery of $50 times the index. The beta of the stock is 1.3. What strategy should the investor follow to reduce beta to 0?
- A stock has a current price of $267. A trader writes 9 naked option contracts on the stock, each contract covering 100 shares. The option price is $2, the strike price is $260, and the time to maturity is 4 months 1. What is the margin requirement if the options are call options (in $)? 2. What is the margin requirement if the options are put options (in $)?A stock is expected to pay a dividend of $1 per share in 2 months and in 5 months. The stock price is $60, and the risk-free rate of interest is 5% per annum with continuous compounding for all maturities. An investor has just taken a short position in a 6-month 1. What are the forward price and the initial value of the forward contract? [Hint: what's the value of a forward contract at the initiation of the contract? 2.Three months later, the price of the stock is $52 and the risk-free rate of interest is still 8% per annum. What is the forward price of a new forward contract with the same expiration date as above? What is the value of the short position in the oldBoth a call and a put currently are traded on stock XYZ; both have strike prices of $49 and expirations of six months. Required: a. What will be the profit/loss to an investor who buys the call for $4.25 in the following scenarios for stock prices in six months? (Loss amounts should be indicated by a minus sign. Round your answers to 2 decimal places.) b. What will be the profit/loss in each scenario to an investor who buys the put for $7.10? (Loss amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)