Homework SourseYou purchase 11 call option contracts with a strike price of
You purchase 11 call option contracts with a strike price of $55 and a premium of $4.50. Assume the stock price at expiration is $67.89
What is your dollar profit
You purchase 11 call option contracts with a strike price of $55 and a premium of $4.50. Assume the stock price at expiration is $67.89
What is your dollar profit
You purchase 11 call option contracts with a strike price of $55 and a premium of $4.50. Assume the stock price at expiration is $67.89
What is your dollar profit
Solution
Schedule of Dollar Profit:
Call option gives the buyer a right to buy but not obiiigatin. It meance if exercise of option is profitble, thn ivesor will exercise the optionotherwse, tey will cancel the option.
In the current sitution, The exerise price of all option Contract is$ 55 and tock Prie is $67.89. It Meance buyer of call ption will Exercise th option at $ 55 nd sell it on on $67.89 inthe Spot Market.
Thus, Dollar profit on The option is $ 92.29
| Particuars | Amount($) | |
| Stock Price | $ 67.89 | |
| Less: Stike Prce | $ 55.00 | |
| Less: Option Premium | $ 4.50 | |
| Dollar Profit | $ 8.39 | |
| NO. Of Contract | 11 | |
| Total Dollar Profit | $ 92.29 |
