Question
A call option on an asset has a delta of 0.4 and a trader has sold 2000 such options. Which one of the following statements
A call option on an asset has a delta of 0.4 and a trader has sold 2000 such options. Which one of the following statements represents the correct course of action that the trader should take to create a delta-neutral position?
- Long 800 shares of the stock
- Short 800 shares of the stock
- Long 800 call options
- Short 800 call options
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International Financial Management
Authors: Cheol Eun, Bruce G. Resnick
8th edition
125971778X, 978-1259717789
