Suppose you purchase 12 put contracts to TREMP Co. stock. The strike price is 38$ and the

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premium is 1.7$. At expiration, the stock is selling for 35$ per share.

Hint: A single put option contract gives the option holder the right to sell 100 shares of stock.

a) What is your put option worth per contract?

b) What is your net profit?

Related Book For answer-question

Fundamentals Of Investments Valuation And Management

ISBN: 9781266824012

10th Edition

Authors: Bradford Jordan, Thomas Miller, Steve Dolvin

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Posted Date: Apr 25, 2024 06:53 AM

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Suppose you purchase 12 put contracts to TREMP Co. stock. The strike price is 38$ and the

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To calculate the value of the put option per contract you need to determine the intrinsic value The ... View the full answer

Fundamentals Of Investments Valuation And Management

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