What is the lowest spot price at expiration

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Reference no: EM132011128

A trader purchases an asymmetric butterfly spread by purchasing 1 call with a strike price of $20, another call with a strike of $30, and selling short two calls at a strike of $27. The premiums are 8, 4, and 1, respectively.?

A. What is the maximum profit on this set of transactions?

B. If at expiration the spot price is $29, what is the net profit (ignoring TVM)

C. What is the lowest spot price at expiration that would still allow the trader to break even?

Reference no: EM132011128

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