a) Given the following information, please explain why some investors believe MNRA stock price will increase...

    

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a) Given the following information, please explain why some investors believe MNRA stock price will increase before 10/16/2020. Date Expiration date 5/19/20 10/16/20 5/20/20 10/16/201 Strike Price $100.00 Spot price $71.67 $73.47 Call Put Call Put Option quotes Implied volatility $15.30 $42.75 134.91% 130.37% $16.15 $42.15 131.06% 125.47% b) What is the probability of losing money if an investor constructs a long straddle on May 20, 2020? Assume the expected annualized stock return is 12%. a) Given the following information, please explain why some investors believe MNRA stock price will increase before 10/16/2020. Date Expiration date 5/19/20 10/16/20 5/20/20 10/16/201 Strike Price $100.00 Spot price $71.67 $73.47 Call Put Call Put Option quotes Implied volatility $15.30 $42.75 134.91% 130.37% $16.15 $42.15 131.06% 125.47% b) What is the probability of losing money if an investor constructs a long straddle on May 20, 2020? Assume the expected annualized stock return is 12%.