Look at the following information. Security Qty Bid Ask Cisco Systems, Inc. $57.02 $57.04 CSCO 14 JAN
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Question:
Look at the following information.
| Security | Qty | Bid | Ask |
| Cisco Systems, Inc. | $57.02 | $57.04 | |
| CSCO 14 JAN 2022 57 CALL | 10 | $0.35 | $0.41 |
| CSCO 14 JAN 2022 60 CALL | 10 | $0.01 | $0.03 |
| CSCO 14 JAN 2022 57 PUT | 10 | $0.35 | $0.41 |
| CSCO 14 JAN 2022 54 PUT | 10 | $0.01 | $0.04 |
a. If you decide to enter into a bear spread, how would it be structured, and what would the potential profit or loss be?
b. What is the spread's profit-to-loss ratio?
c. What is the breakeven point?
d. How much margin (buying power) does this position require?
Expert Answer:
a To structure a bear spread using the given options you would buy the CSCO 14 JAN 2022 57 PUT and sell the CSCO 14 JAN 2022 54 PUT This strategy prof... View the full answer
Related Book For 
Understanding Basic Statistics
ISBN: 9781111827021
6th Edition
Authors: Charles Henry Brase, Corrinne Pellillo Brase
Posted Date:
