Wells fargo common stock

Assignment Help Finance Basics
Reference no: EM133061771

Today is mid-January. You currently hold 100 shares of Wells Fargo common stock in your taxable brokerage account. You have the following information; all prices are per share.

-Wells Fargo's stock price: $38.25.

-March puts on Wells Fargo common stock with a strike price of K = $34 have an underlying asset of 100 shares of stock and a premium of P = $0.20.

-Time to expiration of the option is approximately two months, i.e., T = 2/12 year.

-Wells Fargo's next ex-dividend date is in April and thus may be ignored.

-The continuously compounded, annualized risk-free rate is 0.28%.You establish a protective put. What is the strategy profit per share if the stock price at expiration of the put option is $40 per share? (Assume that all positions are held open until expiration.)

Reference no: EM133061771

Questions Cloud

Growth rates of earnings per share : What are the growth rates of earnings per share and dividends for Toyota and ford over the last years?
Impact on enterprise information systems : Why you think adopting digital transformations is important. You need to discuss this from your perspective and should not focus on business or other related
Construct an investment portfolio : How do you construct an investment portfolio for a corporate investor that is conservative in terms of risks but would like to earn a reasonable return? Please
Positive pro?t in the future : Construct a portfolio consisting of positions in $1 and 82 such that the initial investment is 0, but it will always give a positive pro?t in the future.
Wells fargo common stock : Today is mid-January. You currently hold 100 shares of Wells Fargo common stock in your taxable brokerage account. You have the following information; all price
How much shall be the provision for liability : Milder Company receives notice that Miller Company is in liquidation and the creditor of Miller will invoke the guarantee. How much shall be the provision
What is the current price of emerson stock : Emerson Electric was founded in 1890 in St. Louis, Missouri, as a manufacturer of electric motors and fans. Over the past 100-plus years
What is sean mortgage loan insurance : Sean makes a down payment of $10,000 on a $200,000 home. What is Sean's mortgage loan insurance if the mortgage loan insurance premium is a rate of 3.15%?
What is the effective rate of interest : A store credit card states an annual interest rate of 24.5%. If outstanding balances are compounded daily, what is the effective rate of interest

Reviews

Write a Review

Finance Basics Questions & Answers

  The widget industry in springfield is competitive with many

the widget industry in springfield is competitive with numerous buyers and sellers. consumers dont differentiate among

  Compute the firms price-earnings ratio

The company's share price is 12.13 and the company has 308,820 shares outstanding. Compute the firms price-earnings ratio upto two decimal places.

  Quoted nine-month eurodollar futures price

Calculate the price of a cap on the 90-day LIBOR rate in nine months' time when the principal amount is $1,000. Use Black's model with LIBOR discounting and the following information: (a) The quoted nine-month Eurodollar futures price = 92. (Ignor..

  Find direction of another credit crisis

Are we headed in the direction of another credit crisis? What indicators hint at what could happen in the future?

  Return on investment before and after retirement

Assume a 6% return on investment before and after retirement and that all payments into and withdrawals from savings are at year end.

  Would you recommend buying or selling stock

A company recently paid a dividend of $1.45. You expect dividends to grow at a rate or 5% for 1 year, and then level off to 3.5% per year, forever.

  How much increase could the total capital budget

DeAngelo Corp's projected net income is $150 million, its current target capital structure is 25% debt and 75% equity, and its current target dividend payout

  Estimate the weighted average cost of capital

XYZ is a company that does business in Brisbane. XYZ has 1 million semi-annual coupon bonds with a face value of $1000 each.

  What is the current price of the bond

Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments

  How many qtc would he have to use in country

Isaac travels to Guatemala, with his money and he now wants to exchange it to Guatemlan quetzals (GTQ). He has 4,538, but the rates changed in the day he was tr

  What is the coupon yield for bond

A bond currently trades at $937 on the secondary market. The bond has 16 years until maturity and pays an annual coupon at 7% of face value.

  Number of shares and the new price per share

Determine the current value of your total investment.Do not make any changes to your investment at this time. Calculate your total based on the number of shares and the new price per share, for each company.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd