Stu Purchased Six Put Options on XY Stock with a Strike

question 29

Multiple Choice

Stu purchased six put options on XY stock with a strike price of $45 and an option price of $2.60 per share. The option expires today when the value of the stock is $41.40 per share. What is the net profit on this investment? Ignore trading costs and taxes.

• A) −$260
• B) −$100
• C) $100
• D) $600
• E) $260

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Definitions:

Opposition

In electrical terms, it usually refers to resistance or any impedance to the flow of electric current, hindering the efficient transmission of energy.

Bandpass Filters

Pass a range of frequencies.

Benjamin Rush

A signer of the Declaration of Independence and a prominent physician and educator, known for his contributions to American medical history and advocacy for public health measures.

Voting Rights

Legal provisions that confer the entitlement to participate in the electoral process to select public officials and decide on referendums.