How is arbitrage argument estimated
How is arbitrage argument estimated?
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Remember that the arbitrage argument is an estimated one, relating diversi?ed portfolios, on the assumption which the stock-specific risks are negligible compared along with the factor risks.
Stock price is $98; and European call option struck at $100 along with an expiration of nine months has a value of $9.07. There nine-month, compounded continuously, interest rate is 4.5%. So find out the value of the put option with the same strike and expirat
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