Todayrsquos price of ibmrsquos common stock is 150 a may, Ask an Expert

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Today’s price of IBM’s common stock is $150. A May 2018 call option on this IBM stock has an exercise price of $150 and costs $5. A May 2018 put option on this stock also has an exercise price of $150 and costs $4. What is the cost of holding the long call and long put, and what is this position called? If the stock price is $135 at expiration, what is the portfolio of options worth? If the stock price is $160, what is the portfolio of options worth? How do these profits and losses compare with the value of the stock at expiration?

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Financial Management, Finance

Category:- Financial Management
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