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You Purchase a Put Option on Swiss Francs for a Premium

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You purchase a put option on Swiss francs for a premium of $.02, with an exercise price of $.61. The option will not be exercised until the expiration date, if at all. If the spot rate on the expiration date is $.58, your net profit per unit is:


Definitions:

Dividend Payout Ratio

The percentage of a company's earnings that is distributed to shareholders in the form of dividends.

Debt-Equity Ratio

A ratio enumerating the financial strategy involving the use of equity and debt for asset financing.

Maximum Sales

The highest amount of sales a company can possibly achieve within a given timeframe under existing conditions.

Constant Ratio

A strategy or measure that remains unchanged over a period of time, often used in financial contexts to describe stable investment proportions or fixed financial ratios.

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