1. An investor buys 100 shares of XYZ stock at $30/share and one XYZ 40 put @ $16 to hedge the position. Over eight months, the stock appreciates to $40 per share. The investor is confident that the stock is a good long-term investment with additional upside potential, but is concerned about a near-term weakness in the overall market that could wipe out his unrealized gains. What is the maximum gain for this investor?

1300

unlimited

1400

1700