Question

You have taken a protective put strategy by purchasing 100 shares of ANW stock at $20...

You have taken a protective put strategy by purchasing 100 shares of ANW stock at $20 per share and 1 ANW put option contract at a premium of $1. The put option contract has a strike price of $15. What is the maximum potential loss for this strategy?

A)$600

B)100

C)500

D)800

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Answer #1


Solution: Protective put means holding long position in stock and buying put option. Maximum loss per share = Buy price+put o

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