Question: 3) Which is riskier between writing a call option and writing a put option? Why? 4) Option writers profit and loss An investor is speculating

3) Which is riskier between writing a call option and writing a put option? Why?

4) Option writers profit and loss

An investor is speculating on Apple stock over the next three months. The current Apple stock price is $93.5. She shorted 5 call option contracts of AAPL with the strike price of $94. The price of a call option on AAPL is $ 3.20.

Is she expecting the increase of decrease in Apple stock price?

What is the breakeven stock price for the position?

Consider two possible cases where the stock price becomes $88 or $100 in three months at maturity, respectively. Assume option buyers exercise options when exercisable. What are the profits of the option position for the option writers?

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