Look at the Facebook option quotes in Figure 14.1, and focus on the call and put options

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Look at the Facebook option quotes in Figure 14.1, and focus on the call and put options with a strike price of $80. Can you use put-call parity to infer what the market price of Facebook stock must have been when these option prices were quoted? To keep things simple, assume the options expire in one month, and that the risk-free rate at the time was 0%.

Figure 14.1

Look at the Facebook option quotes in Figure 14.1, and
Strike Price
In finance, the strike price of an option is the fixed price at which the owner of the option can buy, or sell, the underlying security or commodity.
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Fundamentals Of Investing

ISBN: 9780134083308

13th Edition

Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk

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