Assume we are in July, 2023. In July of 2023, the share prices of company B are $80 per share. You believe they should be $30 per share, and are thus overvalued. December 2023 put options on a strike price of $60 per share are currently valued at $5. Each put contract is based on 100 shares. a.) What is your net dollar profit or loss  as a holder of the put contract (based ona contract size of 100 shares) if we arrive at expiry in December and you are wrong and Company B shares are selling for $100?

You buy one Huge-Packing August European call contract and one Huge-Packing August European put contract. Both options are "at the money" and are on 100 shares of Huge-Packing stock each. The call premium is $1.25, and the put premium is $4.50. The current price of the Huge-Packing stock is $50 per share. Disregarding time value of money considerations, at expiration, your highest potential loss from this position is $450 unlimited $275 $125 $575

suppose you short sell 100 shares of IBX, now selling at $172 per share. (a) what is your maximum possible loss? (b) what happens if you simultaneously place a stop-buy order at $182?

Assume you purchased the right to sell 2,000 shares of Target stock in February 2022 at a strike price of $240 per share. Suppose Target stock sells for $212 per share immediately before your options’ expiration. What is the rate of return on your investment? What is your rate of return if the stock sells for $268 per share (think about it)? Assume your holding period for this investment is exactly three months.   Note: A negaive value should be indicated by a minus sign. Do not round intermediate calculations. Enter your 3-month returns as a percent rounded to 2 decimal places.

In January 2023 Apple shares are priced at $200 a share. You believe that they are considerably overvalued and are worth only $120 a share. June 2023 put options on a strike price of $210 a share is currently valued at $18 per share. Each put contract is based on 100 shares. (i) What is the intrinsic value of the put option per share? Explain your reasoning. (ii) What is the time value of the put option per share?  (iii) If we arrive at expiry in June and you are proved correct with Apple shares selling for $120, what is your total net dollar profit (+) or loss (-) on a single put option contract in dollars bearing in mind the put option is based on a contract of 100 shares?  (iv) What will be the total cash settlement by the option writer if the Apple share price expires at $120 per share in June 2023? (v) What is your net dollar profit (+) or loss (-) as a holder of the put contract (based on a contract size of 100 shares) if we arrive at expiry in June and you are wrong and Apple…

Assume we are in July, 2023. In July of 2023, the share prices of company B are $80 per share. You believe they should be $30 per share, and are thus overvalued. December 2023 put options on a strike price of $60 per share are currently valued at $5. Each put contract is based on 100 shares. a.) What is your net dollar profit or loss  as a holder of the put contract (based ona contract size of 100 shares) if we arrive at expiry in December and you are wrong and Company B shares are selling for $100?

Given the following information, price of a stock: strike price of a six-month call: market price of the call: strike price of a six-month put: market price of the put: $102 $100 $6 $100 $3 The maximum amount a short seller (of the stock) can profit is $

You purchase one put option contract on AMD with an exercise price of $100 for a premium of $3.7. You hold the option until the expiration date, when AMD sells for $108 per share. One contract is on 100 shares of the underlying stock. Compute your profit. Your Answer: Answer

Consider a U.S. exchange-traded call option contract to buy 100 shares with a strike price of $37 and maturity in six months. Explain how the terms of the option contract would be revised if the specified change involving the underlying stock were to occur. What would be the revised strike price contract if there were a 5-for 1 stock split? Report your answer rounded to dollars and cents. Answer:

Options were granted on January 1, 2023by Paltel Co. to purchase 15,000 common shares at an exercise price of $22. The average market price of Paltel's common stock during 2023 was $30 per share. Calculate the incremental shares (denominator) for these options on December 31, 2023. (When writing your answer, do not use commas (,) or the dollar sign ($). For example, if your answer is $10,000 write it as 10000). Answer: