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What will be the profit or loss to an investor

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Reference no: EM132730412

Problem - Both a call and a put currently are traded on stock XYZ; both have strike prices of $50 and maturities of six months.

a. What will be the profit/loss to an investor who buys the call for $4.00 in the following scenarios for stock prices in six months?

Stock Price

a. $40

b. 45

c. 50

d. 55

e. 60

b. What will be the profit/loss in each scenario to an investor who buys the put for $6.00?

Stock Price

a. $40

b. 45

c. 50

d. 55

e. 60

Reference no: EM132730412

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