Several factors such as interest rates, volatility, dividend, and underlying stock price can cause options prices to fluctuate. At the start of the Covid-19 outbreak in Malaysia right before the share market reacts to the impact of the outbreak, assuming no government or any third-party intervention, would you expect the of price put options on KLCI to appreciate or depreciate? Justify and discuss based on 3 (THREE) factors affecting option prices. (15 marks)

SUBJECTT: PORTFOLIO MANAGEMENT