PUT-CALL PARITY Payoff Diagram
Inputs                                                      Put-Call Parity - Payoff Diagra...
am




tock      Bond Payoff

e Price




  $60     $70    $80


                 $56.00    $64.00    $72.00    $80.00   $...
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Put Call Parity Payoff Diagram

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Put Call Parity Payoff Diagram

  1. 1. PUT-CALL PARITY Payoff Diagram Inputs Put-Call Parity - Payoff Diagram Call Price Now $4.00 $60 Stock Price Now $43.00 Exercise Price $40.00 $40 Riskfree Rate 5.00% $20 Time To Maturity 0.25 Dividend $2.00 $0 Payoff Time To Dividend 0.10 Call Payoff Short Stock Bond Payoff -$20 Payoff Total Payoff Exercise Price -$40 -$60 -$80 $0 $10 $20 $30 $40 $50 $60 $70 $80 Outputs Stock Price at Maturity Stock Price at Maturity $0.00 $8.00 $16.00 $24.00 $32.00 $40.00 $48.00 Call Payoff $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $8.00 Short Stock Payoff $0.00 -$8.00 -$16.00 -$24.00 -$32.00 -$40.00 -$48.00 Bond Payoff $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 Total Payoff $40.00 $32.00 $24.00 $16.00 $8.00 $0.00 $0.00 Exercise Price Put Payoff $40.00 $32.00 $24.00 $16.00 $8.00 $0.00 $0.00
  2. 2. am tock Bond Payoff e Price $60 $70 $80 $56.00 $64.00 $72.00 $80.00 $40.00 $40.00 $16.00 $24.00 $32.00 $40.00 -$56.00 -$64.00 -$72.00 -$80.00 $40.00 $40.00 $40.00 $40.00 $0.00 $0.00 $0.00 $0.00 -$80.00 $60.00 $0.00 $0.00 $0.00 $0.00

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