F303 Intermediate Investments
Lecture 18: Stock Options
Option Contract
Call Option This is a right (but not an obligation) to buy an asset at
a pre-arranged price (the exercise price or strike price) on or until a
pre-arranged date (the maturity);
Put
F303: Intermediate Investments
Sample Midterm
Part I: 45 points
Part II: 25 points
Part III: 30 points
Version 1
1 of 12
F303: Intermediate Investments
=
E(R)
V ar(R) =
N
X
i=1
N
X
2
P ri Ri
P ri (Ri E(R)2
i=1
=
E(R)
T
1X
Rt
T
t=1
v
u
q
u
=
=t
(R)
V a
F303 Intermediate Investments
Lecture 19: Option Pricing
Goals for Today
Practice problems of option strategy
Binomial option pricing
F303 Intermediate Investments - Wenyu Wang
Review from Last Lecture: Put-call Parity
Put-call parity is the relationsh
F303: Intermediate Investments
Sample Midterm
Part I: 45 points
Part II: 25 points
Part III: 30 points
Version 1
Part I (45 points)
1. Which of the following correlation coefficients may allow an investor in a two-asset portfolio
to diversify away all his
F303 Intermediate Investments
Lecture 20: Options Pricing
Goals for Today
Binomial option pricing
Solve pricing problems
F303 Intermediate Investments - Wenyu Wang
Review from Last Lecture: Binomial Pricing Model
Stock
Bond
$125
up
up
$100
$108
$100
dow
F317 / Spring 2017
Study Guide + Sample Questions
(Exam 3)
Equity Bible Chapters to know for the exam:
Chapter 2 Issuing Equity & the Cap Table
Chapter 5 Negotiating Equity Investments
Chapter 6 Conducti
F305 INTERMEDIATE CORPORATE FINANCE
PRACTICE QUESTIONS
Disclaimer: Please do not assume that the actual Exam 3 will have similar problems,
or that it will emphasize the same concepts as in the practice questions. Note that there
are several important topi
F317 - Hays
Waterfall
Problem + Answer
4-15-17
Structure of the Investments
Series B
Series A
Angel
Investment $30,000,000 $3,000,000 $500,000
Security
Type
Dividends
F&F
Founders
$250,000
$0
ConverHble