Question: Please type the answer. (e) How does a market-maker decide the edge (offset) required to perform an options trade? Explain why this edge would be

Please type the answer. (e) How does a market-maker decide the

Please type the answer.

(e) How does a market-maker decide the edge (offset) required to perform an options trade? Explain why this edge would be different for options of different strikes as well as for option combinations? (6 marks)

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