# Tag Info

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ATM options are always more liquid. Options with shorter maturities are also more liquid. Best way to learn more is to open a brokerage account that doesn't have any minimum amounts or monthly fees and you can watch some delayed live option quotes across a whole chain of strikes and maturities . The first question you are asking is really how to profit if ...

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The payoff can be decomposed as \begin{align*} \phi(S) &= 100 \, I_{50 \le S_T < 100}\\ &= 100 \, \big(I_{S_T \ge 50} - I_{S_T \geq 100}\big). \end{align*} Note that, under the risk-neutral measure $P$, \begin{align*} E(I_{S_T \ge K} \mid \mathcal{F}_t) &= P(S_T \ge K \mid \mathcal{F}_t)\\ &= N(d_2), \end{align*} where \begin{align*} d_2 = ...

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You are mostly right, I don't really get what you don't understand. The answer in the book is quite clear, but let me put it that way : Selling a put and buying a call on the same underlying $S$ with same maturity and same stike $K$ is always equivalent to a long position in a forward contract on $S$ with delivery price $K$. The easiest way to see that is ...

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