Check out the delayed quotes for Amazon options for different exercise prices and maturities. Take the mean

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Check out the delayed quotes for Amazon options for different exercise prices and maturities. Take the mean of the bid and ask prices.

a. Confirm that higher exercise prices mean lower call prices and higher put prices.

b. Confirm that longer maturity means higher prices for both puts and calls.

c. Choose an Amazon put and call with the same exercise price and maturity. Confirm that put–call parity holds (approximately). You will have to use an up-to-date risk-free interest rate.

Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...
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Related Book For  answer-question

Principles of Corporate Finance

ISBN: 978-1260013900

13th edition

Authors: Richard Brealey, Stewart Myers, Franklin Allen

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