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All you know is that the spot price for Tesla at $280 per share. Is a Call on Tesla stock, Strike= $290 per share Expiring
All you know is that the spot price for Tesla at $280 per share.
Is a Call on Tesla stock, Strike= $290 per share Expiring in 3 months much more expensive than
a call with a strike of $300 expiring in 2 years?
A. | They are exactly the same price | |
B. | Yes because $290 is closer to being ATM
| |
C. | Not enough data to determine that. At a minimum you'd need to know the forward rate and the volatility for each of those periods
| |
D. |
No because $300 is a higher number than $290 |
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