Which of the following statements best describes put–call parity?
A. The put price always equals the call price.
B. The put price equals the call price if the volatility is known.
C. The put price plus the underlying price equals the call price plus the present value of the exercise price.
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From put–call parity, which of the following transactions is risk- free?
A. Long asset, long put, short call
B. Long call, long put, short asset
C. Long asset, long call, short bond
Based on put-call parity, a trader who combines a long asset, a long put, and a short call will create a synthetic:
A. long bond.
B. fiduciary call.
C. protective put.
Which of the following transactions is the equivalent of a synthetic long call position?
A. Long asset, long put, short call
B. Long asset, long put, short bond
C. Short asset, long call, long bond
Combining a put, a forward contract and a zero-coupon bond generates equivalent outcomes at expiration to those of a:Here these three assets have the same maturity. The put and the forward contract have the same exercise price. The face value of the bond is equal to this exercise price.
A. fiduciary call.
B. long call combined with a short asset.
C. forward contract combined with a risk- free bond.