Glad it was helpful! If you like our video lessons, it would be appreciated if you could leave us a review at www.trustpilot.com/review/analystprep.com
I really like this educator's videos. Is there a playlist of his lectures? Or his course on Analystprep portal??? I enjoy watching him more than the other educators.
Glad it was helpful! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a Google review using this link: g.page/r/CQIlM78xSg01EB0/review
Glad it helped! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a review here: trustpilot.com/review/analystprep.com
You're welcome! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a Google review using this link: g.page/r/CQIlM78xSg01EB0/review
An investor is speculating on Company ZZ shares. The shares are currently trading at $140 per share. The investor believes that Company ZZ’s shares will experience a bearish run, and she wants to use call options to take advantage of this. She finds that a call option on Company ZZ’s shares, with an exercise price of $120, is selling at a premium of $400. She decides to buy the call option and simultaneously writes another call option on Company ZZ’s shares, with an exercise price of $105, at a premium of $600. One call option is made up of 100 shares. a) what is the net cost(gain) of the position b) what is the maximum loss c) what is the maximum gain d) what is the break even e) what can the investor do to retain the same profile of the option strategy in the scenario but using put options instead?
Why would the investor want to take advantage of call options if he believes that Company ZZ’s shares will experience a bearish run, why not use put options? Or maybe sell the forward contracts? According to my understanding, if one believes or expects the share price to go down in value (bearish run), then buying put options will be advantageous.
I cannot imagine how you have explained the subject in that amazing way... Thanks a million.
what an easy explanation even a beginner should be able to grasp without confusion !!!
cant thank you enought!!!! you made this topic super easy to understand in a structured way!!!
You're welcome! If you like our video lessons, it would be appreciated if you could leave us a review at www.trustpilot.com/review/analystprep.com
Thank you for this clear and concise explanation, it has helped me a lot
Clear explanation ever. Thank you so much
thank you so much it is so helpful for exams
Glad it was helpful! If you like our video lessons, it would be appreciated if you could leave us a review at www.trustpilot.com/review/analystprep.com
I really like this educator's videos. Is there a playlist of his lectures? Or his course on Analystprep portal??? I enjoy watching him more than the other educators.
Thank you so much, you have cleared my confusions so well !!
Glad it was helpful! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a Google review using this link: g.page/r/CQIlM78xSg01EB0/review
Perfect video, thanks a lot.
Glad it helped! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a review here: trustpilot.com/review/analystprep.com
Thank you
Perfect thanks
You're welcome! If you like our video lessons, it would be appreciated if you could take 2 minutes of your time to leave us a Google review using this link: g.page/r/CQIlM78xSg01EB0/review
amazing
Clear and bright explanation
you are the best!
Thank you sooooooo much
Excellent
Love him❤❤
EXCELLENT
Perfect
Thank you!
Somebody please help me with this activity below;
An investor is speculating on Company ZZ shares. The shares are currently trading at $140 per share. The investor believes that Company ZZ’s shares will experience a bearish run, and she wants to use call options to take advantage of this. She finds that a call option on Company ZZ’s shares, with an exercise price of $120, is selling at a premium of $400. She decides to buy the call option and simultaneously writes another call option on Company ZZ’s shares, with an exercise price of $105, at a premium of $600. One call option is made up of 100 shares.
a) what is the net cost(gain) of the position
b) what is the maximum loss
c) what is the maximum gain
d) what is the break even
e) what can the investor do to retain the same profile of the option strategy in the scenario but using put options instead?
lol
Why would the investor want to take advantage of call options if he believes that Company ZZ’s shares will experience a bearish run, why not use put options? Or maybe sell the forward contracts?
According to my understanding, if one believes or expects the share price to go down in value (bearish run), then buying put options will be advantageous.