The payoff diagram for owning an underlying asset (i.e. a stock) looks like this: How...
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The payoff diagram for owning an underlying asset (i.e. a stock) looks like this: How can you replicate this payoff diagram via an option strategy (using only options)? Short a put option with strike price K and long a put option with strike price K. Short a put option with strike price K and long a call option with strike price K. Long a call option with strike price K and short a call option with strike price K. Long a put option with strike price K and short a call option with strike price K
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