Imagine that you are holding 6,600 shares of stock, currently selling at $50 per share. You are ready to sell the shares but would prefer to put off the sale until next year due to tax reasons. If you continue to hold the shares until January, however, you face the risk that the stock will drop in value before year-end. You decide to use a collar to limit downside risk without laying out a good deal of additional funds. January call options with a strike price of $55 are selling at $3, and January puts with a strike price of $45 are selling at $5. What will be the value of your portfolio in January (net of the proceeds from the options) if the stock price ends up at $36, $50, $56
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Business, 22.06.2019 08:30
What has caroline's payment history been like? support your answer with two examples
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Business, 22.06.2019 11:10
An insurance company estimates the probability of an earthquake in the next year to be 0.0015. the average damage done to a house by an earthquake it estimates to be $90,000. if the company offers earthquake insurance for $150, what is company`s expected value of the policy? hint: think, is it profitable for the insurance company or not? will they gain (positive expected value) or lose (negative expected value)? if the expected value is negative, remember to show "-" sign. no "+" sign needed for the positive expected value
Answers: 2
Imagine that you are holding 6,600 shares of stock, currently selling at $50 per share. You are read...