Create an excel spreadsheet that plots the profit/loss of an option strategy that uses two options. The spreadsheet should have 4 input cells identifying parameters for each option:

Type of option (Put/Call)

Buy/Sell

Strike

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From the input cells, you will create a table that dynamically calculates the profit/loss of the two options combined. As you change the parameters, the graphs should change automatically. You’ll likely need to use a ‘Nested IF’ statement.

The plot should display the profit/loss for every possible price from 0-100.

From the graph, create a profit/loss diagram where the spot price is on the horizontal axis, and the total profit is on the vertical axis. The red line will represent the profit depending on what the price of the stock is at expiration.

To check your work: If you buy 1 put, and buy 1 call, then your graph should look something like this:

If you sell 1 put, and sell 1 call, your graph should look something like this:

If you buy 1 call, sell 1 put, your graph should look like this: