Question: Note there are multiple answers. [MULTIPLE] Suppose you hold a share of ABF stock. You consider a protective put position with 3-month expiration and exercise
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Note there are multiple answers.
[MULTIPLE] Suppose you hold a share of ABF stock. You consider a protective put position with 3-month expiration and exercise price of 200 GBp. You purchased the stock at 300 GBP and the premium of put option is 10 GBp. Which of the following statements are correct? The value of the portfolio at 3-month maturity cannot be higher than 300 GBp. If the stock price lower than 200GBp at 3-month expiry, the value of the portfolio at 3- month expiry is o GBp. If the stock price is 240 GBp at 3-month expiry, the value of the portfolio at 3-month expiry is 240 GBp. If the stock price higher than 200GBp at 3-month expiry, the value of the portfolio at 3- month expiry is 0 GBp. The value of the portfolio at 3-month maturity cannot be lower than 200 GBp
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