Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. in your portfolio you have purchased 1 european ca

In your portfolio you have purchased 1 European Call option and written 1 European Put...

90.2K

Verified Solution

Question

Accounting

In your portfolio you have purchased 1 European Call option and written 1 European Put option on stock ABC for $4 and $2 respectively. The strike/exercise prices of both the options are equal to $50. These options are set to expire on the 3rd Friday of June 2015. The possible values for the price of the stock ABC on the 3rd Friday of June 2015 are: $30 with 20% chance; $50 with 30% chance and $70 with 50% chance. The standard deviation of the returns on your portfolio is:

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Two identical point charges (q = +5.80 x 10-6 C) are fixed at opposite corners of...

Physics
Q

Kathy had a dream in which she was selling roses in an international market She...

Basic Math
Q

6 All owners of a condominium complex pay removal grass cutting cable television and building...

Basic Math
Q

A particle moves in a straight line with the velocity functionv(t) = sin(wt)cos^8(wt). Find its...

Basic Math
Q

alpha corporation 2014. 2015. net income. $320,000 $350,000 dividnes $10,000. $ 20,000...

Accounting
Q

y the web. Add the NOT The Road Concile they were collected ry Last ...

Accounting
Q

Accounting
Q

Kalan sre: 52:30 Soru 3 Advertising and marketing costs are included in manufacturing overhead. Yantnz:...

Accounting
Q

World Airlines has no preferred stock calculating. The company had 50,000 shares of common stock,...

Accounting
Q

Manually calculate the compound amount and compound interest (In $) for the investment. ...

Accounting
Q

Halloween Costumes Unlimited is considering a new 3-year store expansion project that requires an initial...

Finance
Q

QUESTION 5 Suppose you purchased a stock a year ago. Today, you receive a dividend...

Finance