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An investor owns 10,000 shares of IBM stock, which is currently trading at $100 per share. She decides to buy 100 put option with a
An investor owns 10,000 shares of IBM stock, which is currently trading at $100 per share. She decides to buy 100 put option with a strike price of $90 at a price of $4, so the total cost is $40,000. If IBM stock decreases from $100 to $80, what is the profit associated with the protective put buying strategy?
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