Question
Delta of a call option is 0.85. How many units of the underlying stock should you hold to hedge a short position in 100 call
Delta of a call option is 0.85. How many units of the underlying stock should you hold to hedge a short position in 100 call option contracts? The contract multiplier is 100.
| a. | 85,000 | |
| b. | 85 | |
| c. | 8,500 | |
| d. | 0.85 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert Hughes, Melissa Hart
14th Edition
1264101597, 9781264101597
