You form a short straddle by selling a call with a premium of C = $9, and selling a put with a premium of P = $8. Both options have an exercise price of X = $47, both mature in 8 months, and both have the same underlying asset. Find the profit of this straddle when the price of the underlying asset is S = $74.

Answer rating: 100% (QA)

To calculate the profit of a short straddle position we need to consider the ... View the full answer