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Imagine that you are holding 5,400 shares of stock, currentlyselling at $45 per share. You are ready to sell the shares butwould prefer to put off the sale until next year due to taxreasons. If you continue to hold the shares until January, however,you face the risk that the stock will drop in value beforeyear-end. You decide to use a collar to limit downside risk withoutlaying out a good deal of additional funds. January call optionswith a strike price of $50 are selling at $4, and January puts witha strike price of $40 are selling at $5. What will be the value ofyour portfolio in January (net of the proceeds from the options) ifthe stock price ends up at $32, $45, $52? What will the value ofyour portfolio be if you simply continued to hold the shares?Stock PricePortfolio Value$32$45$52If collar is used$$$If you continued to hold the shares$$$