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Assignment:

A trader buys 100 European call options with a strike price of $20 and a time to maturity of one year. The cost of each option is $2. The price of the underlying asset proves to be $22 in one year.

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Question: What is the overall (the one year period) trader's gain or loss if interest rate is 10% per annum continuos compounding?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91169782

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