Solution-Calculate the speculators combined gain or loss if

Calculate the speculators combined gain or loss if the price

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Reference no: EM13512624

1.A speculator buys a July corn futures contract at $2.18/bu. and simultaneously writes a July 220 corn futures call option at 8 cents. Calculate the speculator's combined gain or loss if the price of corn rises to 235 and the option is exercised.

2.One hundred shares of a stock are purchased for $45 per share. Simultaneously, a 5 year warrant on the same company is sold short @ $8. The warrant permits the pur¬chase of 100 shares of stock from the company at $55. Over the next five years, a total of $2.50 in dividends is received on each share. What is your profit or loss if, at the end of the warrant's life, the stock price is

a. $40

b. $50

c. $60

3.You are involved in a portfolio insurance strategy, and are interested in replicating a particular put option with a delta of ? 0.4889. You would combine this put with your stock position to effectively form a protective put. If you own 100,000 shares of the under¬lying stock how many shares should you sell short in your short account to leave you with the synthetic protective put?

Reference no: EM13512624

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Calculate the speculators combined gain or loss if the price : A speculator buys a July corn futures contract at $2.18/bu. and simultaneously writes a July 220 corn futures call option at 8 cents. Calculate the speculator's combined gain or loss if the price of corn rises to 235 and the option is exercised.

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Calculate the speculators combined gain or loss if the price

Reference no: EM13512624

Reference no: EM13512624

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