Given the following information, an investor expects the probability of making money is less than 75%...

Given the following information, an investor expects the probability of making money is less than 75% if he buys the call option. Do you agree? Why? Assume the stock price follows a log normal distribution with an expected annual return of 5% and standard deviation of 60%.

Current USO price: $10.11

Call options price: $1.33

Strike price: 9.50.

Time to maturity: 4 months

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jeff jeffy answered 1 year ago

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Given the following information, an investor expects the probability of making money is less than 75%...

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