Consider a Portfolio Comprised of a Short Call and a Short

question 9

Multiple Choice

Consider a portfolio comprised of a short call and a short put, both options written on the same stock, same strike, and for the same maturity. Which of the following is valid?

• A) The intrinsic value of the portfolio is zero.
• B) The time value of the portfolio is zero.
• C) The insurance value of the portfolio is negative.
• D) All of the above.

---

Definitions:

Carbon Dioxide Fixation

The process of converting carbon dioxide into organic compounds, such as glucose, during photosynthesis.

Rubisco

An enzyme involved in the first major step of carbon fixation, a process by which atmospheric carbon dioxide is converted by plants to energy-rich molecules.

RuBP

Ribulose bisphosphate, a substance that plays a critical role in the process of carbon fixation in photosynthesis.

PGAL

PGAL, or Phosphoglyceraldehyde, is a three-carbon molecule that plays a crucial role in both photosynthesis and glycolysis, acting as an intermediate in the conversion of glucose and other sugars.