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A one-month European call option on Bitcoin is with the strike price of $8,505, $8,705, and $8,905 are trading at $600, $500, and $415, respectively. An investor implements a butterfly spread (i.e., she buys one call with the strike price of $8,505, sells two calls with the strike price of $8,705, and buys one call with the strike price of $8,905. If at the maturity, the Bitcoin price is $8,605, what is the investor's profit

1 Answer

3 votes

Answer:

The investor profit will be $85

Step-by-step explanation:

Kindly check attached picture for detailed calculation

A one-month European call option on Bitcoin is with the strike price of $8,505, $8,705, and-example-1
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User Skaak
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