Business, 25.10.2019 21:43 gennhill14

The common stock of the avalon corporation has been trading in a narrow range around $40 per share for months, and you believe it is going to stay in that range for the next 3 months. the price of a 3-month put option with an exercise price of $40 is $3, and a call with the same expiration date and exercise price sells for $4. calculate the total premium income of selling (shorting) a straddle (a short straddle involves simultaneously buying a put option and call option with the same underlying asset, same exercise price and expiration date). show all work

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The common stock of the avalon corporation has been trading in a narrow range around $40 per share f...

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