A trader buys a European put on a share for $3. The stock price is $42 and

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A trader buys a European put on a share for $3. The stock price is $42 and the strike price is $40.

Under what circumstances does the trader make a profit? Under what circumstances will the option be exercised? Draw a diagram showing the variation of the trader's profit with the stock price at the maturity of the option.

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Options Futures And Other Derivatives

ISBN: 9780130090560

5th Edition

Authors: John C. Hull

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Question Posted: Oct 18, 2024 07:01 AM

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A trader buys a European put on a share for $3. The stock price is $42 and

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Options Futures And Other Derivatives

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