Response to the following :
1. Review the ASX website and examine the information provided on options and options trading. What information is supplied, and what is useful to understanding options trading?
2. Alcan shares recently closed at $52.51. Assume that you write a covered call on Alcan by writing one September call with a strike price of $55, and buying 1000 shares at the market price. The option premium that you obtain from writing the call is $3700. Assume the share will pay no dividends between now and the expiration date of the option.
a. What is the total profit if the share price remains unchanged?
b. What is the total profit if the share price goes up to $55?
c. What is the total loss if the share price goes down to $49?