Question: A trader writes five naked put option contracts, with each contract being on 100 shares. The option price is $10, the time to maturity is

A trader writes five naked put option contracts, with each contract being on 100 shares.
The option price is $10, the time to is six months, and the is $64.
(a) What is the margin requirement if the stock price is $58?
(b) How would the answer to (a) change if the rules for index options applied?
(c) How would the answer to (a) change if the stock price were $70?
(d) How would the answer to (a) change if the trader is buying instead of selling the options?

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a The margin requirement is the greater of 500 10 02 58 10800 and 500 10 ... View full answer

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