Assume the stock price is 50. A european call- (put) option with one year maturity and strike

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Assume the stock price is 50€. A european call- (put) option with one year maturity and strike price K=50€ costs 5€ (4€). A risk-free bond costs 45€ today and pays-off in one year 50€. Which principle is violated here?

Related Book For answer-question

Fundamentals of Futures and Options Markets

ISBN: 978-0132993340

8th edition

Authors: John C. Hull

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Posted Date: Oct 07, 2020 07:01 AM

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Assume the stock price is 50. A european call- (put) option with one year maturity and strike

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Concept Principal of PUT CALL PARITY is voilated here As per PUT CALL PARITY Pri... View the full answer

Fundamentals of Futures and Options Markets

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