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Business, 28.03.2020 03:20 Laocean9281

Suppose, you are an investment broker. Your client wants to take five option positions on the stock of Plumbus. The stock is currently trading at $40.

(1) She wants to buy a call option with a strike price of $40 at an option price of $4.
(2) She also wants to buy a put option with a strike of $45 at an option price of $10.
(3) She also wants to sell a second call option with a strike of $30, and an option price of $14.
(4) She also wants to sell a put option with a strike of $44, and an option price of $8.
(5) Finally, she wants to buy a call option with a strike price of $43, and an option price of $3.
Construct a profit diagram for this investment strategy. Create a graph of the portfolio payouts.

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