1.You write a short put option giving the purchaser the right to sell 100 shares of Rothbard Corporation for a premium of $1,300. The strike price of the option is $20 and the final stock price is $85. What is your profit or loss?

2.You write a short call option giving the purchaser the right to buy 100 shares of Garrett Corporation for a premium of $1,600. The strike price of the option is $35 and the final stock price is $210. What is your profit or loss?

Answer rating: 100% (QA)

Solution 1 To calculate the profit or loss on the short put option we need to consider the following ... View the full answer