The Delta of a Call Option on a Non-Dividend-Paying Stock

question 13

Multiple Choice

The delta of a call option on a non-dividend-paying stock is 0.4.What is the delta of the corresponding put option?

• A) -0.4
• B) 0.4
• C) -0.6
• D) 0.6

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Definitions:

Possibility of Error

The probability that a statistical inference or decision made might be incorrect due to the limitations of sampling or experimental design.

Statistical Significance

The probability that an observed difference or relationship exists in a population, not just in the sample studied.

Hypothesized Reason

A suggested theory developed from minimal evidence intended to serve as a foundation for additional research.

Statistical Significance

A determination that a relationship between variables is not likely to be due to chance at a specified level of probability.