Brandon word 1-2. Use the following information for ITT stock options. You consider only bull,...
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Brandon word 1-2. Use the following information for ITT stock options. You consider only bull, beat, butterfly, and straddle strategies. Assume that all options are exercised at their expiration Strike Option Price Strick Option Price $140 Call $140 Put $133 Call $6 $130 Put $130 Call SIO $1 $17 $9 ITT's current stock price is $130. 1. ITT will release its earnings report tomorrow. You expect ITT stock price to significantly increase or decrease by at least $20 (from the current stock price) depending on its earnings results. a) What strategy is appropriate? (2 pts) b) Draw the profit line of the strategy you chose. (10 pts) c) If the stock price increases to $164, find your profit. (3 pts)
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