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27 September, 00:17

When you construct the replicating portfolio for the option in the previous question how many dollars do you need to invest in the cash account

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  1. 27 September, 00:34
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    Answer: The same amount of dollars

    When it comes to the financial level, a replicating portfolio as the name implies, is a repetition of specific flows of a given asset, so it must be constituted with the same resources. In this case, the same amount of cash would be needed to create the replica.
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