Question: Question 4 5 pts A stock EET is trading at $50. You believe that the stock is going to move a lot but are not
Question 4 5 pts A stock EET is trading at $50. You believe that the stock is going to move a lot but are not sure of the direction of the movement. So you create a straddle position by buying 1 call and 1 put both with a strike of $50. The call option is costing $6 and the put option is costing $5. Both options are 1-month options. Suppose at expiration the stock drops to $40, what is your profit? 2 OO -13 D Question 5 5 pts In the previous question if the stock price increases to $65 at expiration time, what is your profit? 00 O 15
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