A stock is currently priced at $45. It will either increase by 20% or decrease by 10% over the next two months. If you sold a put option with exercise price of $45 and two months to maturity, how many shares of stock should you buy or sell to hedge the option?

Answer rating: 100% (QA)

Current Stock Price 45 Upstate 20 Downstate 10 Exercise Price of Put option 45 First we will look at ... View the full answer