I. short the stock II. buy a call at 50 III. write a call at 55 IV. buy a put at

ID: 2624917 • Letter: I

Question

I. short the stock

II. buy a call at 50

III. write a call at 55

IV. buy a put at 45

I. Her maximum loss is $3,625.

II. Her maximum loss is $125.

III. Her minimum gain is $125.

IV. Her maximum profit is unlimited.

I. limited her losses to $275.

II. unlimited loss potential.

III. limited her gains to $275.

IV. unlimited profit potential.

III Your credit risk exposure increases when interest rates decline unexpectedly.

IV Your credit risk exposure increases when interest rates increase unexpectedly.

Since Time is less, I shall try to answer this in the comments and then you can rate my statement if you think the answer is complete. Thanks

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.