What opportunities are available to an arbitrageur

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Problem - A EurOpean call and put both have a strike price of $20 and expire in 3 months. Both sell for $3. Assume the annual interest rate is 12%, the current stock price is $19 and the dividend yield is 5%. What Opportunities are available to an arbitrageur? Show the cash ?ows associated with your arbitrage strategy.

Reference no: EM132984571

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