Question: Data: S 0 = 108; X = 120; 1 + r = 1.1. The two possibilities for S T are 130 and 90. a. The

Data: S0 = 108; X = 120; 1 + r = 1.1. The two possibilities for ST are 130 and 90.

a.

The range of S is 40 while that of P is 30 across the two states. What is the hedge ratio of the put?(Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)

Hedge ratio

b-1.

Form a portfolio of three shares of stock and four puts. What is the (nonrandom) payoff to this portfolio? (Omit the "$" sign in your response.)

Nonrandom payoff $

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