Assume that the current price of a stock is S0 = 100. An investor holds long one European put option with a strike price of K = 100 and short one European call option with strike K = 105. Both options mature at the same time T. Assume that the stock price at maturity is ST = 102. What is the payoff to the investor?

Answer rating: 100% (QA)

Heres how to calculate the payoff to the investor in this scenario 1 Analyze the Put Option Exercise ... View the full answer