When does the trader make money and lose money

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A trader buys two call options, one with strike $55 and price $10, the other with strike $65 and price $5. The trader also sells two call options, both with strike $60 and price $7. Ignore the time value of money and show trader's net profit as a function of the stock price at maturity. When does the trader make money and lose money? When would you use such a trading strategy? Explain carefully your beliefs on which you base your speculation about the market.

Reference no: EM13949370

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