Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Thomas buys 100 shares of stock for $40, then purchases one put contract (X=35) for a premium of $1 (per option, and one contract includes
Thomas buys 100 shares of stock for $40, then purchases one put contract (X=35) for a premium of $1 (per option, and one contract includes 100 options). Thomas plans to sell the stock in 6 months, when the put option expires. If the price on expiration day is $62, what is Thomas' total profit in dollars?
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