You buy 300 shares of ABC stock at $53 per share. At the same time, you write 300 call options on ABC stock with exercise price equal to $51 and call premium $6.92. Calculate your profit if ABC stock price at the expiration of the option is $48.06 per share.
A. 
$594 

B. 
$594 

C. 
$1,482 

D. 
$1,482 

E. 
$692 
You buy 320 call options with exercise price of $72 and call premium of $6.50. You write 640 call options with exercise price of $75 and call premium of $4.10. You also buy 320 call options with exercise price of $78 and call premium of $2.90. All the options have the same underlying asset and expire on the same date. Calculate the profit of your strategy if the stock price at expiration is equal to $76.70.
A. 
$40 

B. 
$44 

C. 
$36 

D. 
$32 
Premium received  $ 2,076.00  (300*6.92)  
Loss on stock  $ 1,482.00  (5348.06)*300  
Profit  $ 594.00  
Hence option A is correct
Per option  Total  
Profit 320 call 72  $ 1.80  $ 576.00 
Profit 640 call 75  $ 2.40  $ 1,536.00 
Profit 78 call  $ 2.90  $ 928.00 
$ 32.00 
Hence option D is correct
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