Question: If you write 2000 call options on stock X with a premium of $3.15 and a strike price of 110, and at the expiration date

If you write 2000 call options on stock X with a premium of $3.15 and a strike price of 110, and at the expiration date the price of stock X is 114, then:

your profit is $1700.

your loss is $2300.

your loss is $1700.

your profit is $2300.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

If you write 2000 call options on stock X with a premium of $3.15 and a strike price of 110, and at the expiration date the price of stock X is 114, then: a. your loss is $1700. b. your profit is...

If you write 2000 call options on stock X with a premium of $3.15 and a strike price of 110, and at the expiration date the price of stock X is 114, then: a. your profit is $2300. b. your profit is...

1. Use the BlackScholes formula to value the following options: a. A call option written on an energy stock selling for $60 per share with a $60 exercise price. The stock's volatility is 6% per...

For the purposes of this question, you should make the following assumptions (except where noted in the questions below): all tables provided D = 0.2 (both for Media General and the media companies...

For the below, make the following assumptions (except where noted in the questions below): All tables provided. D = 0.2 (both for Media General and the media companies in Exhibit 12) The market...

1.An investor believes that the Cisco stock price is going to increase in the following 12 months from the current stock price of $200. Call options on Cisco stock expiring in 12 months have a strike...

IPlease help ASAP solve part 3 . Please give proper amount of decimals. ntro An investor believes that the Cisco stock price is going to increase in the following 1 2 months from the current stock...

you need to pick two options. One Put and one call. You will need to fill out all the information on this spread sheet Option Worksheet Date Put/Call? Underlying Stock Ticker Strike Price: (X)...

PROBLEM 5. 15 points] The given graph is the payolt function of a consisting of European options. E2 - E Which trading strategy among the following four has the same payoft (1) Buying a put option...

You purchased 10 put option contracts on Mountain Builders stock at an option premium of $1.65. The strike price is $35.5. What is your break-even stock price? You purchased a put with a strike price...

A small British esthetics company has developed a unique product that the producer has exported successfully to a few regional areas of the US. A South African retail chain has made some inquiries...

Life insurance companies tend to invest in long-term assets such as loans to manufacturing firms to build factories or to real estate developers to build shopping malls and skyscrapers. Automobile...

The statement of cash flows helps analysts evaluate all but which of the following? 0 0 : 2 8 . 5 6 Multiple Choice The amount of debt relative to equity. Source of cash used for plant expansion....

A company is preparing completing their Cash Budget. The following data has been prepared for cash receipts and payments. January February March Cash receipts $1,061,200 $1,182,400 $1,091,700 Cash...