Question
I own a stock at $100 and I'm worried it will go down 50% in the next month to $50, so I buy a one
I own a stock at $100 and I'm worried it will go down 50% in the next month to $50, so I buy a one month put option with a $70 strike for $3.
The stock does indeed fall to $50. What is my profit from the put option?
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
Public Finance An International Perspective
Authors: Joshua E. Greene
1st Edition
9814365041, 978-9814365048
