Question

You bought Stock A at a purchase price of: Put option strike price: $25 $15 Option expiration date: Price of put option: June 30, 2020 $5 Stock goes up to $50 Stock goes down to $5 Profit/Loss on stock if sell now Profit/Loss on call option if sell now

Answer 1

Put Option is excersied when the Stock price is lower than the Strike price Option Expiration date 30-06-2020 Stock price $25.00 Put option $15.00 strike price Put option $5.00 price Stock price goes up to $50 Stock Price > Strike Price Put option will not be exercised Strike price stock price No Profit/ Loss as it will not be exercised Premium Net profit Profit/ loss on put option $25.00 $5.00 $0.00 $5.00 $5.00 Stock price now Stock price when it was bought Profit Loss on Put option (i.e. Premium) Total Profit/ loss Profit / loss on stock if sell now $50.00 $25.00 $25.00 $5.00 $30.00 Stock price goes down to $5 Stock Price <Strike Price Put option will be exercised Strike price Profit/ loss on put $25.00 option Profit Premium Net profit stock price $5.00 $20.00 $5.00 $15.00 Stock price now Stock price when it was bought Profit Profit on Put option Total Profit/ loss Profit / loss on stock if sell now $5.00 $25.00 $20.00 $15.00 $5.00