Apple currently trades at $422. You can buy a 3-month put option on Apple stock with...
Apple currently trades at $422.
You can buy a 3-month put option on Apple stock with a strike price of $417 for $25.1. How much do you have to pay to establish a protective put position for a single unit?
Homework Answers
Current price, S0 = $ 422
Strike price, K = $ 417
Option premium = $ 25.17
Here, we have to pay an amount equal to option premium in order to establish a protective put position.
So, premium has to be paid to establish a protective put position.
That is $ 25.10.
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