XYZ's share price is currently $60. You are considering two possible investment strategies to profit from a predicted fall in XYZ share price: (i) short sell 50 shares at the spot price, or (ii) enter a long put option (quoted at $3.40) which allows you to sell 100 shares at a strike price of $50.

Calculate the share price at which the two strategies generate the same net profit.

Answer rating: 100% (QA)

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