Suppose you invest in the S&R index for $1000, buy a 950-strike put, and sell a 1107

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Suppose you invest in the S&R index for $1000, buy a 950-strike put, and sell a 1107 strike call. Draw a profit diagram for this position. How close is this to a zero-cost collar? Discuss.

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Derivatives Markets

ISBN: 978-0321543080

4th edition

Authors: Rober L. Macdonald

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Question Posted: Dec 18, 2015 04:56 AM

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Suppose you invest in the S&R index for $1000, buy a 950-strike put, and sell a 1107

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Our initial cash required to put on the collar ie the net option premi...View the full answer

Derivatives Markets

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