CFA CFA Level 1 Anyone know the future cash flows for a call option that creates a synthetic option?

Anyone know the future cash flows for a call option that creates a synthetic option?

  • This topic has 1 reply, 2 voices, and was last updated Feb-21 by cfachris.
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    • pcunniff
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      Hi – I see the put is A, but does anyone know the call?

      Which of the following portfolios has the same future cash flows as a put option?

      A) Long call option, long risk-free bond, short underlying asset.

      B) Long call option, short risk-free bond, long underlying asset.

      C) Short call option, long risk-free bond, long underlying asset.

    • cfachris
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      With the put-call parity equation, a (long) call option should equal: Long put option, long underlying asset, short risk-free bond

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