You own 100 shares of Apple that you purchase at $120. At the same time, you purchase the stock you also buy 1 put that expires in 3 months. It is a put that has an exercise price of $110 and costs you $2. In 3 months when the option expires Apples stock is at $90. Ignoring dividends calculate the price % change in Apple during this period and your return given the information above. Why is your return not as bad? Recall: Value of option position = # contacts X price X 100