Recently, Encik Aiman bought a September FKLI call option which carries an exercise price of 920 at a premium of 25 points. Assume before expiry, the FKLI drops to 890. Calculate his total profit or loss.*

2 points

A. His profit is RM1,250.

B. His loss is RM1,250.

C. His profit is RM1,500.

D. His loss is RM1,500.

Recently, Encik Hazeem bought a September FKLI call option which carries an exercise price of 920 at a premium of 25 points. Assume before expiry, the FKLI drops to 890. Calculate his breakeven.*

2 points

A. His breakeven is 865 points.

B. His breakeven is 895 points.

C. His breakeven is 915 points.

D. His breakeven is 945 points.

Roslem sold a put option with an exercise price of RM60 at a premium of RM6. Determine his profit or loss when the stock price is at RM50.*

2 points

A. RM10 profit

B. RM10 loss

C. RM4 loss

D. RM4 profit

The market price of a stock is at RM40. Based on the above situation, determine type of the option should holder choose and the strike price if the holder want to exercise the option.*

2 points

A. put option with a strike price of RM30

B. call option with a strike price of RM50

C. call option with a strike price of RM35

D. put option with a strike price of RM35

Marina is a portfolio manager who is currently managing RM5,000,000 worth of share portfolio. She expects that the share market is going to decline soon. It is now early July, and she decides to enter the KLCI Futures market to protect the value of her share portfolio. Based on her observation, the index currently stands at 880 and the September FKLI contract is at 900. She decides to hedge 90% of her portfolio. If the market index falls to 860 in September, evaluate the net gain in the value of the portfolio.*

2 points

A. RM113,366.36

B. RM111,111.11

C. RM88,888.89

D. RM86,363.64

Topic- financial market