What is the effective price she paid for synthetic bull

Assignment Help Business Management

Reference no: EM133578815

Question

A trader has an existing position of 100 shares of AAPL stock at $275. She decides to purchase a 260 put option for $17 and sell a 290 strike call option for $16. Synthetically, this is equivalent to buying a 260/290 bull call spread. Using the properties of put call parity, and ignoring the time value of money function, what is the effective price she paid for the synthetic bull call spread? Please enter your answer as a number with two decimal places (no dollar sign).

Reference no: EM133578815

Questions Cloud

What were the major reasons for adopting these methods : Based on demographics, employment details, etc. What were the major reasons for adopting these methods? Your answer should be based on deduction.

What are ethical concerns do the types of punishments cause : Look at this article- what are ethical concerns do these types of punishments cause? Are they effective? Why or why not?

Interest had compounded annually : How much more could you have earned over a 20-year period if the interest had compounded annually?

How much emphasis/time/effort is your team currently giving : How much emphasis/time/effort is your team currently giving to the following practice/resistance training attributes: volume, intensity, technique?

What is the effective price she paid for synthetic bull : Ignoring the time value of money function, what is the effective price she paid for the synthetic bull call spread?

Explain the ethical practices around the globe emerging : Avoid theoretical explanation and include only practical applications and examples to explain the topic of your choice. Ethical practices around the Globe

Which political party of the 1790s-the federalists : Which political party of the 1790s-the Federalists or the Democratic-Republicans-best fit with the ideals of republicanism?

Economic analysis as part of fundamental analysis : Explain the most important economic variables to consider when conducting an economic analysis as part of fundamental analysis.

Conventional investment wisdom is to hold diversified port : Conventional investment wisdom is to hold a diversified portfolio, preferably uncorrelated assets

User Account

All Pages