A speculator purchases a put option for a premium of $2.75, with an exercise price of...

A speculator purchases a put option for a premium of $2.75, with an exercise price of $70. The stock is presently priced at $69, and rises to $82 before the expiration date. What is the stock price at which the speculator would break even?

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jeff jeffy answered 1 year ago

A speculator bought a sale option with a price of 60 TL at a premium of...

A speculator bought a sale option with a price of 60 TL at a premium of 3 TL, and sold the sale option at a price of 66 TL with a premium of 4 TL at the same time. What strategy did the speculator implement for what purpose? Show the profit and loss situation of the strategy on the chart.

Assume that a speculator purchases a put option on British pounds (with a strike price of $1.50) for $.05 per unit.

Assume that a speculator purchases a put option on British pounds (with a strike price of $1.50) for $.05 per unit. A pound option represents 31,250 units. Assume that at the time of the purchase, the spot rate of the pound is $1.51 and continually rises to $1.62 by the expiration date. The highest net profit possible for the speculator based on the information above is:

The premium on a pound put option is $.03 per unit. The exercise price is $1.60....

The premium on a pound put option is $.03 per unit. The exercise price is $1.60. The break-even point is _______ for the buyer of the call, and _______ for the seller of the call. (Assume zero transactions costs and that the buyer and seller of the put option are speculators.) $1.57; $1.57 $1.63; $1.63 $1.63; $1.57 $1.57; $1.63

A speculator buys a call option for $1.5, with an exercise price of $20. The stock...

A speculator buys a call option for $1.5, with an exercise price of $20. The stock is currently priced at $19, and rises to $26 on the expiration date. The speculator will exercise the option on the expiration date (if it is feasible to do so). What is the speculator's profit per unit?

What is the price of a put premium vs. a call option premium if they have...

What is the price of a put premium vs. a call option premium if they have the same strike price and same expiration on the same stock? Is one typically more expensive than the other?

If the share price is $21.50 and the exercise price and premium of a call option...

If the share price is $21.50 and the exercise price and premium of a call option written on that share are $19.90 and $2.00, respectively, what is the time value of the option? Select one: $2.00 $0.40 $0.00 $17.90 $1.60

Consider a call option with a premium of $8 for which the exercise price is $50....

Consider a call option with a premium of $8 for which the exercise price is $50. What is the profit for a holder if the underlying stock price at expiration is $60.00? What is the profit for the seller?

1a) Suppose a put option with a strike price of $65 has a premium of $11,...

1a) Suppose a put option with a strike price of $65 has a premium of $11, while another put on the same underlying stock has a strike price of $70 and a premium of $9. Both options expire at the same time. In this situation, an arbitrageur would... Answers: a. do nothing because arbitrage is not possible. b. buy both put options. c. buy the 70-strike put and sell the 65-strike put. d. buy the 65-strike put and sell the...

You are interested to value a put option with an exercise price of $100 and one...

You are interested to value a put option with an exercise price of $100 and one year to expiration. The underlying stock pays no dividends, its current price is $100, and you believe it either increases to $120 or decreases to $80. The risk-free rate of interest is 10%. Calculate the put option's value using the binomial pricing model, presenting your calculations and explanations as follows: a. Draw tree-diagrams to show the possible paths of the share price and put...

1 (a). A put option with an exercise price of $17 that expires in 4 months...

1 (a). A put option with an exercise price of $17 that expires in 4 months currently costs $3. The stock price is currently $18 and the risk-free rate of return is 0.04. What is a call option worth (same exercise price and expiry)? (b) Draw the profit diagram (at expiry) for the put option from part (a)

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