An investor has a portfolio consisting of the following assets and instruments. A long-call option with

Question:

An investor has a consisting of the following assets and instruments.
• A long-call option with K = $40 and a call premium of $3 at the time of purchase.
• A short-put option with K = $45 and a put premium of $4 at the time of purchase.
• Two short-call options with K = $35 and a call premium of $5 at the time of purchase.
• Two short-stock positions that cost $40 per share at the time of purchase.
Assume that each of these contracts has the same expiration date, and ignore the time value of money. If the stock price at expiration is ST = $60, what is the net profit of this Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...