What trades should the investor place in calls in puts


A Finance professor you know makes the following statement: The payoffs to call and put options depend on the stock price. If an investor expects the stock price to increase, he or she can trade options to make a tidy profit.

i. What trades should the investor place in calls? In puts? Explain.

ii. How do you react to the professor’s statement?

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Financial Management: What trades should the investor place in calls in puts
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