1.  Investor has 3,000 of IBM currently valued at $101. He sets up a collar at $96 with a premium of $11.08, and $110 with a premium of $12.54. When the collar expires the stock is trading at $90.90

a. The impact to the portfolio of this collar at the time it is put in place is $________. (dollars, rounded to two places after the decimal)

b. The value of the portfolio at the close on the day the collar expires is $________. (dollars, rounded to two places after the decimal)

2.You set up a Bull Spread on 100 shares of Home Depot using one $110 call @ $15.76 and one $122 call @ $8.22. At expiration Home Depot is trading at $129.47

a. You hold the spread to expiry so your profit (loss) is $________. (dollars, rounded to two places after the decimal)

Answer rating: 100% (QA)

Lets calculate the impact and value of the portfolio for each scenario 1 Collar for IBM a The impact ... View the full answer