You create a strap by buying two calls and one put on ABC stock, all with a

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You create a “strap” by buying two calls and one put on ABC stock, all with a strike price of $45. The calls cost $5 each and the put costs $4. If you close your position when ABC stock is priced at $55, what is your per-share gain or loss?

a. $4 loss

b. $6 gain

c. $10 gain

d. $20 gain.

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Fundamentals Of Investments Valuation And Management

ISBN: 9781266824012

10th Edition

Authors: Bradford Jordan, Thomas Miller, Steve Dolvin

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Question Posted: Dec 31, 2023 10:51 AM

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You create a strap by buying two calls and one put on ABC stock, all with a

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Lets analyze the profitloss for each option and then sum them up Calls You bou...View the full answer

Fundamentals Of Investments Valuation And Management

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