Short the call at the premium

Assignment Help Finance Basics
Reference no: EM132235012

Question text

You currently have a position on a covered call. A covered call is a combination of a long stock and a short call on the same stock. You purchased the stock at the price of $50 and short the call at the premium of $3. The call option has an exercise price of $60. If the stock price increases to $57, what is your net income?

Reference no: EM132235012

Explain why sunk costs should not be included in a capital

Explain why sunk costs should not be included in a capital budgeting analysis but opportunity costs and externalities should be included. Give an example of each.(briefly)

Calculate the certainty equivalent cash flow

A project has an expected risky cash flow of $300, in year 3. The risk-free rate is 5%, the market risk premium is 8% and the project's beta is 1.25. Calculate the certainty

Analysis and evaluation of international investments

International investment is a prudent part of any investment portfolio. International investment helps to diversify the investment portfolio. Although, international investmen

Discuss how the current process used by rating agencies

Discuss how the current process used by rating agencies could be improved. Analyze the impact of interest rates on both short term and long term debt and how health care org

Compare two major competitors in the same industry

You are the assistant to the CEO of a major company. Your CEO keeps an eye on the competition, and asks you to do the following. Using ratio analysis, compare two major comp

Prepare a spreadsheet to calculate the depreciation for resi

Prepare a spreadsheet to calculate the depreciation for residential (27.5-year recovery period) and commercial (39-year recovery period) real estate using the straight-line de

Prepare a sales budget for the la store

Babycakesis used as the company for all parts of the budget planning and control report. Briefly discuss each of the main reasons the owner of babycakes prepares a budget us

Estimate the current price of the bond

Microsoft has a bond outstanding (symbol: MSFT.GB) with a 4.20% coupon rate and a yield to maturity (continuously compounded) of 1.535%. The bond expires in June, 2019, and

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd