You bought a stock at $67 and want to use a protective put strategy that consists in
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Question:
You bought a stock at $67 and want to use a protective put strategy that consists in buying a put to protect against losses on the stock position. Puts with a strike K=62 are quoted with a bid of $1.08 and an ask of $1.21. What is the maximum loss on the entire strategy?
{Enter the positive number of the loss (do not use a negative sign in your answer) with 2 decimals. For example, if you compute the profit/loss to be -34.56. Then, the loss is 34.56. Enter your answer as 34.56}
Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780135811603
5th Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
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