Answer Happy

Three friends Tom, Jerry, and Kate are members of an investment club. They each have a total of £10,000 to invest in three companies A, B, and C. On 1st Nov 2016, the following prices were available (£) с A 55 13 Share Call Put Strike price, K 0.91 2.48 58 B 110 2.17 4.33 115 0.89 0.09 12.5 They made the following investments (not considering any dividends and commissions) Tom bought 80 A shares, 200 B calls and saved the rest of the money in the bank Jerry bought 50 B shares, 400 C puts and saved the rest of the money in the bank Kate bought 50 A shares, 100 B calls and spent the rest on C shares. The options expired after six months and the bank interest rate was 5% compounded continuously (assume that fractional numbers of shares may be purchased). If, at the end of six months, A shares were worth £59, B shares £108 and C shares £12, find the value of each of the three friends portfolios and, hence the returns they made on their original investment of £10,000.