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put_call_parity - Chapter 14 Options Markets Payoffs and...

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Chapter 14 Options Markets
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.       Payoffs and Profits on Options at Expiration - Calls Notation Stock Price = S T Exercise Price = X Payoff to Call Holder ( S T - X) if S T >X 0 if S T < X Profit to Call Holder Payoff - Purchase Price
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.       Payoffs and Profits on Options at Expiration - Calls Payoff to Call Writer - ( S T - X) if S T >X 0 if S T < X Profit to Call Writer Payoff + Premium
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.       Profit Profit Stock Price Stock Price 0 Call Writer Call Writer Call Holder Call Holder Profit Profiles for Calls Profit Profiles for Calls
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.       Payoffs and Profits at Expiration - Puts Payoffs to Put Holder 0 if S T > X (X - S T ) if S T < X Profit to Put Holder Payoff - Premium
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.       Payoffs and Profits at Expiration - Puts Payoffs to Put Writer 0 if S T > X -(X - S T ) if S T < X Profits to Put Writer Payoff + Premium
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.       Profit Profiles for Puts Profit Profiles for Puts 0 Profits Stock Price Put Writer Put Holder
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.       Put-Call Parity Payoff of long call, short put S T < X S T > X Payoff for Call Owned 0 S T - X Payoff for Put Written-( X -S T ) 0 Total Payoff S T - X S T - X
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