To answer Q1 – Q6, please

To answer Q1 – Q6, please

To answer Q1 – Q6, please provide graphs showing the relationship between the position profit (Y-axis) and the stock price at expiration (X-axis).Suppose the price of a non-dividend-paying stock is currently $50, its volatility is 25%, and the risk-free rate for all maturities is 4% per annum. All the options below expire in 4 months (=4/12 years). The option prices are not given here but you can use Derivagem to find the option prices. Choose a “Black-Scholes-European” for Option Type in D17 cell. You must include all the Derivagem outputs (6 total) in your Excel file by copying or taking a screenshot.A bull spread using European call options with strike prices of $45 and $50. (The call price for K=$45 option should be $6.38. If not, double check the parameters you used in Derivagem.)A bear spread using European put options with strike prices of $45 and $50.A butterfly spread using European call options with strike prices of $45, $50 and $55.A butterfly spread using European put options with strike prices of $45, $50 and $55. (Hint: The total profit graph should be identical to Q3.)A straddle using options with a strike price of $50.A strangle using options with strike prices of $50 and $55.

%d bloggers like this: