You sell a put option on a stock for $4 with a strike price of $30. The stock currently sells for $28. If the stock goes up to $35 what is your net profit or loss?
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You sell a put option on a stock for $4 with a strike price of $30. The stock currently sells for $28. If the stock goes up to $35 what is your net profit or loss?
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- An investor purchases a stock for $38 and a put for $.50 with a strike price of $35. The investor sells a call for $.50 with a strike price of $40. What is the maximum profit and loss for this position? Draw the profit and loss diagram for this strategy as a function of the stock price at expiration.1. You buy a call option on a stock for $7 with a strike price of $60. The stock currently sells for $65. The stock goes up to $75. What is your net profit or loss? 2. You sell a put option on a stock for $4 with a strike price of $30. The stock currently sells for $28. If the stock goes up to $35 what is your net profit or loss?An investor purchases a stock for $38 and a put for $.50 with a strike price of $35. The investor sells a call for $.50 with a strike price of $40. What is the maximum profit and loss for this position? Maximum profit
- You have written a call option on Walmart common stock. The option has an exercise price of $81, and Walmart’s stock currently trades at $79. The option premium is $1.60 per contract. a. How much of the option premium is due to intrinsic value versus time value? b. What is your net profit if Walmart’s stock price decreases to $77 and stays there until the option expires? c. What is your net profit on the option if Walmart’s stock price increases to $87 at expiration of the option and the option holder exercises the option?The price of a stock is $35. A put option to sell that stock at $36 is currently selling for $3. You buy the stock and the put. Complete the following table and answer the questions. Round your answers to the nearest dollar. Use a minus sign to enter negative values, if any. If the answer is zero, enter "0". Price of the stock Profit on stock Profit on put Net profit $22 $ $ $ 29 $ $ $ 36 $ $ $ 43 $ $ $ 50 $ $ $ 64 $ $ $ What is the maximum possible profit on the position? The maximum possible profit is . What is the maximum possible loss on the position? Enter your answer as a positive value. $ What is the range of stock prices that generates a profit? The position generates a profit as long as the price of the stock exceeds $ . What advantage does this position offer? Enter your answer as a positive value. Round your answer to the nearest dollar. The investor limits the to $ .Suppose you purchase 20 call contracts on SAMSONG Co. stock. The strike price is $120, and the premium is $8. If the stock is selling for $140, $128, $120 per share at expiration, what are your call options worth? What is your net profit?
- Suppose you purchase eight call contracts on Macron Technology stock. The strike price is $60 and the premium is $3. If, at expiration, the stock is selling for $64 per share, what are your call options worth? What is your net profit?You have purchased a put option on Pfizer common stock. The option has an exercise price of $45 and Pfizer's stock currently trades at $47. The option premium is $0.60 per contract. a. What is your net profit on the option if Pfizer's stock price does not change over the life of the option? b. What is your net profit on the option if Pfizer's stock price falls to $41 and you exercise the option? (For all requirements, negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. (e.g., 32.16)) a Net profit b. Net profit per share per shareYou buy a put option on IBM common stock. The option has an exercise price of $136 and IBM’s stock currently trades at $140. The option premium is $5 per contract.a. What is your net profit on the option if IBM’s stock price increases to $150 at expiration of the option and you exercise the option? b. How much of the option premium is due to intrinsic value versus time value?c. What is your net profit if IBM’s stock price decreases to $130?d. Draw the payout diagram at maturity on a short put option position, option premium = $2, and the same exercise price... (Please give the full solution I will upvote)
- Refer to the stock options on Microsoft in the Figure 2.10. Suppose you buy a November expiration call option on 100 shares with the excise price of $140. Required: a-1. If the stock price at option expiration is $144, will you exercise your call?a-2. What is the net profit/loss on your position? (Input the amount as a positive value.)a-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) b-1. Would you exercise the call if you had bought the November call with the exercise price $135?b-2. What is the net profit/loss on your position? (Input the amount as a positive value.)b-3. What is the rate of return on your position? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.)c-1. What if you had bought the November put with exercise price $140 instead? Would you exercise the put at a stock price of $140?c-2. What is the rate of return on your position? (Negative…You bought a $50 strike call option on a stock XYZ for $8.20 and then sold/wrote a $65 call option for $4.35. What price would the stock have to be at expiration for you to start losing profit?You have purchased a put option on ABC common stock for $3 per contract. The option has an exercise price of $54. What is your net profit on this option if stock price is $41 at expiration?