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What are the payoffs at expiration of portfolio

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Reference no: EM133114552

Consider the following portfolio consisting of three derivatives:

(a) short one put option with strike price K, (b) short one futures contract with futures price F0 = K + 5, and (c) long one call option with strike price K + 10. What are the payoffs at expiration of this portfolio? Find the payoff function and draw the payoff graph, labeling important points.

Reference no: EM133114552

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