CoboCards App FAQ & Wishes Feedback
Language: English Language
Sign up for free  Login

This flashcard is just one of a free flashcard set. See all flashcards!

All main topics / Finance & Investment / Derivatives / Derivatives
16.A trader buys a call and sells a put with the same strike price and maturity date. What is the position equivalent to?
A.A long forward
B.A short forward
C.Buying the asset
D.None of the above
Answer: A

From adding up the two payoffs we see that A is true: max(ST−K,0)−max(K−ST,0)= ST−K
New comment
Flashcard info:
Author: CoboCards-User
Main topic: Finance & Investment
Topic: Derivatives
Published: 27.10.2015




Forgot password?
Deutsch  English