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5. What does it mean if the: a. delta of a call option is 0.7?...

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5. What does it mean if the: a. delta of a call option is 0.7? How can a short position in 1,000 options be made delta neutral when the delta of each option is 0.7? (5 marks) b. theta of an option position is -0.1 when time is measured in years? If a trader feels that neither a stock price nor its implied volatility will change, what type of option position is appropriate? (5 marks) C. gamma of an option position? What are the risks in the situation where the gamma of a position is large and negative and the delta is zero

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