You establish a straddle on Walmart using September call and put options with a strike price of $47. The call premium is $4.75 and the put premium is $4.00.
a. What is the payoff on this position if Walmart is selling for $47 in September? $
b. What will be your payoff if Walmart is selling for $35.25 in September? $
c. What will be your payoff if Walmart is selling for $47.05 in September? $
d. What is the cost of this investment strategy? $
e. What will be your percent return if Walmart is selling $47 in September? percent