Which One of the Following Is True for an Investor

question 90

Multiple Choice

Which one of the following is true for an investor who purchased a share of stock for $45 and purchased a $45 put option on the stock?

• A) The investor profits when the stock decreases in value.
• B) The maximum loss is the price of the option premium.
• C) The investor is protected against upside potential.
• D)Increases in the value of the stock will go to the seller of the put.

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