A Put Option Has a Strike Price of $32

question 55

True/False

A put option has a strike price of $32. The current price of the stock is $34. The put option is said to be "in-the-money."

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Definitions:

Shares

Holdings in a corporation or financial asset, these units confer rights to an equitable distribution of dividends from declared profits.

Quarterly Dividend

A dividend paid by a company to its shareholders every quarter, representing a portion of the company's earnings.

Capital Gains

The profit earned from the sale of an asset or investment which has increased in value over the holding period.

Shares

Units of ownership in a company or financial asset that represent a portion of the total capital.