Options Strategies on Microsoft and Facebook Stocks (A)

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Case Details Case Introduction 1 Case Excerpts

Abstract

The case study describes how the board of Newway Bright Stock Fund, a first generation fund management firm, decided to use Options investment strategies for hedging as well as for speculation purpose, in order to achieve the next level of growth. The case study provides sufficient information to construct, distinguish, and analyze the payoff profiles of various Options strategies.

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Issues

The case is structured to achieve the following teaching objectives:

  • Construct various basic Options strategies with the help of NYSE Options data.
  • Calculate the payoff profiles of using various Options strategies using Options data of Microsoft and Facebook
  • Analysis the risk and reward in using Options strategies

Contents
INTRODUCTION
EXHIBIT

Keywords

Long Straddle, Short Straddle, Long Strangle, Short Strangle, Long Strip, Short Strip, Long Strap, Short Strap, Microsoft, Facebook, In-The-Money, Out-of-The-Money, Strike Prices, Options strategies, Options.

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