You Own 1,300 Shares of ABC Stock That Is Currently

question 78

Multiple Choice

You own 1,300 shares of ABC stock that is currently priced at $36 a share. Given this price, the option delta for a $34 call option on this stock is .724. How many $34 call options do you need to hedge against a −$1 change in the price of the stock?

• A)buy 1,570 options
• B)buy 2,072 options
• C)write 1,769 options
• D)write 2,072 options
• E)write 2,439 options

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