Question: Long currency straddle Call option premium = $0.05/, Put option premium = $0.05/ Strike price = $1.10/, Option contract size = 62,500 Requirements 1: 1a.
- Long currency straddle
- Call option premium = $0.05/, Put option premium = $0.05/
- Strike price = $1.10/, Option contract size = 62,500
- Requirements 1:
- 1a. Fill the table
- 1b. Draw graphs of call option, put option, and straddle
- 1c. Mark BE point, strike prices, and each premium
| Spot exchange rate | $0.00/ | $1.00/ | $1.05/ | $1.10/ | $1.15/ | $1.20/ | $1.25/ | |
| Long call option | Exercise (N/Y) |
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| Profit |
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| Long put option | Exercise (N/Y) |
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| Profit |
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| Net profit per unit |
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| Mark Break-even point |
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Net profit per unit
| | | | | | | | |______________________________________________________________________________ Future Spot Rate | | | | | | | | | | |
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