Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose you buy a January expiration put option on 200 shares with the exercise price of $45. If the stock price at option expiration is

image text in transcribed
Suppose you buy a January expiration put option on 200 shares with the exercise price of $45. If the stock price at option expiration is $42, will you exercise your put? What is the net profit/loss on your position? (Round your answer to the nearest dollars) Strike Call Put 40 14.21 0.12 45 9.32 0.32 Expiration May 20 2022 May 20 2022 May 20 2022 Jan 20 2023 Jan 20 2023 Jan 20 2023 50 4.8 1.05 40 14.6 1.19 45 10.5 2.14 50 7.2 3.70 Yes, net profit of $172 O No, net loss of $457 No, net profit of $457 Yes, net loss of $172

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

COMMENT INVESTIR ABC DE LA FINANCE

Authors: OLIVIER CHAZOULE

1st Edition

2020367521, 978-2020367523

More Books

Students also viewed these Finance questions

Question

2. Write an Objectives section for your rsum.

Answered: 1 week ago