Estimate the possible payout

The estimated payout for the call option at $175 and the put option at $170 for PepsiCo (PEP) over 8 days cannot be accurately predicted without additional information such as the current stock price, implied volatility, and the time until expiration. However, we can provide a general analysis based on the options pricing model.

The payout for the call option (C) and the put option (P) can be estimated using the following formulas:

C = Max(0, K - S) - X
P = Max(0, S - K) + X

where:
K = strike price of the option
S = current stock price
X = premium received for the option
t = time until expiration
r = risk-free interest rate
σ = implied volatility

In this case, the strike prices are $170 for the put option and $175 for the call option. Assuming the current stock price is between $170 and $175, the put option will be in-the-money and the call option will be out-of-the-money.

The payout for the put option will be the difference between the strike price and the stock price, minus the premium received. The payout for the call option will be the difference between the stock price and the strike price, minus the premium received.

The total payout for the 8-day period will depend on the changes in implied volatility and the stock price over the next 8 days. If the stock price remains stable or increases, the call option will expire worthless, and the investor will only receive the premium received for the put option. If the stock price decreases, the put option will increase in value, and the investor may choose to exercise the option and sell the stock at the higher strike price.

It's important to note that options trading involves risk, and the actual payout may differ from the estimated value due to various factors such as changes in implied volatility, interest rates, and market conditions. It's recommended to consult with a financial advisor or use an options pricing model to estimate the potential payout for a specific investment strategy.