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An investor purchases a stock for $56 and a put for $.80 with a strike price...

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Finance

An investor purchases a stock for $56 and a put for $.80 with astrike price of $50. The investor sells a call for $.80 with astrike price of $66. What is the maximum profit and loss for thisposition? (Loss amount should be indicated by a minussign.)

Maximum profit$
Maximum loss$

Answer & Explanation Solved by verified expert
3.6 Ratings (398 Votes)
1 If the stock price falls below 50 The call option will be exercised the payoff from the put option strike price stock price 50 stock price Capital gain from the    See Answer
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An investor purchases a stock for $56 and a put for $.80 with astrike price of $50. The investor sells a call for $.80 with astrike price of $66. What is the maximum profit and loss for thisposition? (Loss amount should be indicated by a minussign.)Maximum profit$Maximum loss$

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