The future value of the call and put option prices (premiums) for the same underlying asset and
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Question:
The future value of the call and put option prices (premiums) for the same underlying asset and having the identical maturity date are:
Exercise price 90.0 110.
call premium 14.0 4.0
put premium 2.4 12.0
1.Show the profit diagram for a call bull spread, which is created by buying one call option at the exercise price
90 and selling one call option at 110.Discuss your results.
2.Show the profit diagram for a put bull spread, which is created by buying one put option at the exercise price
90 and selling one put option at 110. Compare your results with those of question 1 and explain the
differences between a call bull spread and a put bull spread.
Related Book For
Advanced Financial Accounting An IFRS Standards Approach
ISBN: 9781285428765
4th Edition
Authors: Pearl Tan, Chu Yeong Lim, Ee Wen Kuah
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