© K. Cuthbertson and D. Nitzsche Figures for Chapter 7 OPTIONS MARKETS (Financial Engineering : Derivatives and Risk Management)

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Presentation transcript:

© K. Cuthbertson and D. Nitzsche Figures for Chapter 7 OPTIONS MARKETS (Financial Engineering : Derivatives and Risk Management)

© K. Cuthbertson and D. Nitzsche Figure 7.1 : Buy one European call option STST Profit Strike price K = $80 $5 -$3 Call premium $88$83 K = $

© K. Cuthbertson and D. Nitzsche Figure 7.2 : Sell (write) a European call option STST Profit Strike price K = $80 -$5 $3 Call premium $88 $83 K = $80 0 0

© K. Cuthbertson and D. Nitzsche Figure 7.3 : Buy (long) a European put option Strike price K = $70 STST Profit $3 -$2 Put premium $68 $65K = $70 0 0

© K. Cuthbertson and D. Nitzsche Figure 7.4 : Sell (write) a European put option Strike price K = $70 STST Profit $2 -$3 Put premium $68 $65 K = $

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