You purchase one Ruth April 25 put contract for a premium of $6.58. You hold the option until the expiration date, when Ruth stock sells for $32 per share. Calculate the profit/loss you will realize on the investment.

Q: You invest $500 today and an additional investment of $500 three years from today. You expect to…

A: Present value refers to the current value of a sum of money in the future at a specified interest…

Q: A call option on MSFT (Microsoft) stock has the following terms: exercise/ strike price is $305;…

A: A call option gives the holder the right but not the obligation to buy at the strike price. A call…

Q: Done AA experthiring.cheggindia.com Subject Test Note: - You are attempting question 3 out of 12 Mr.…

A: A put option is a contract that gives the owner the right, but not the duty, to sell–or sell short–a…

Q: You have only one day left to decide whether to exercise a call option on the Company X stock, which…

A: A Buyer of a call option has an option to buy the underlying at a specified price at a specified…

Q: An investor purchases 25 call option contracts at a price of $1.86 and a strike price of $50. At…

A: Given: Contract price =$1.86Strike price =$50Stock price =$47.62Option purchase =25 (100 share)

Q: . Calculate the current equity on each of the next four days. . Calculate the excess equity for…

A:

Q: You purchased two $35 call contracts at $3.40 per option. You exercised the option on expiration day…

A: Call Option is a financial derivative contract which givers option buyer a right not obligation to…

Q: You buy an “at the money” April call option on M&M Corp. common stock, which has a strike price of…

A: ATM calls and puts have a striking price that is equal to or extremely near to the current market…

Q: Examine the profit and losses for the writer (seller) of the call option. What constitutes the…

A: a) If the stock price is $20 at expiration, the call options will expire worthless, resulting in a…

Q: & non dividen poyng Consider a long forware Contrect to purchese Stock in Emoritht that the Current…

A: Forward Price = Spot Price*e^(rt) Where, r= risk freee Interest = 9% Months = 8 Years = 8/12 = 0.67…

Q: You purchased five call option contracts with a strike price of $32 and an option premium of $1.50.…

A: A call option is a financial contract that gives the buyer the right, but not the obligation, to…

Q: You purchase 8 put option contracts on HSB Industries. The strike price was $45 and the option…

A: An option is a type of financial derivative that is used for hedging. In an option contract, the…

Q: You purchase AAPL put option with an exercise price of $120 for a premium of $4.3. You hold the…

A: Put option: It is a contract that provides a right (but not any obligation) to the option holder to…

Q: A writer sells 100 call options with strike $46 for $0.94 each and deposits these premiums in a…

A: A writer receives the premium for the call option sold. He receives $0.94 per option.The amount he…

Q: You purchase a six month $1.25 strike put option on the British pound for $0.12 per unit. Each…

A: The put option provides the right to an investor but not an obligation for selling the stock at a…

Q: Christine buys 75 put options with a strike price of $28 and a premium of $4 per contract. If the…

A: Number of put options = 75 Strike price = $ 28 Premium per contract = $ 4 Expiration market price =…

Q: At the time of the initiating the contract, the price of a stock is $65. A trader sells 5 naked put…

A: Naked option is created when the option writer (seller) does not currently own any, or enough, of…

Q: You wish to build a synthetic long call for Microsoft stock with a strike price of $40.00 and an…

A: In synthetic long call positions, one buy stock and also buy put option and create call type…

Q: You write a put option contract at a premium of $1.55/option: you are short in the put. The options…

A: Solution:Selling a put option means obligation to buy the underlying asset at strike price on…

Q: WRE is currently trading at $120/share. You sold 8 PUT-option contracts on WRE with a strike price…

A: Current Price = $120No of Put Options = 8Strike Price = $110Premium = $8

Q: A call option on MSFT (Microsoft) stock has the following terms: exercise/ strike price is $305;…

A: A call option gives the holder the right and not the obligation to buy underlying asset at the…

Q: A 6-month call option on Meyers Inc.'s stock has a strike price of $45.00 and sells in the market…

A: The calculation is: Hence, the option Premium is $2.

Q: Dumo is a trader at ZNF Equity traders and has just identified a stock, UFSI Limited, which is…

A: For long position (purchase) in Put option, Pay off from long position in stock:

Q: Suppose you buy a January expiration put option on 200 shares with the exercise price of $45. If the…

A: solution concept Put option means the right to sell the stock Strike price means the price at which…

Q: Assuming Nifty trades at Rs. 17,200 on 18.02.2022. Your client enters a long straddle by buying a…

A: 1. Call option - call option provides the holder of the option , the right and not the obligation to…

Q: Mary buys 23 call options with a strike price of $85 and a premium of $3 per contract. If at…

A: Number of call options = 23 Strike price = $ 85 Premium per contract = $ 3 Expiration price = $ 79

Q: Suppose that you, on 1st of January 2024, enter a long position in a 10-year forward contract on a…

A: Explanation1. Initial Setup for Long Position (2024)• Stock Price, 𝑆0S0: $50• Risk-Free Rate, r: 5%…

Q: Mary buys 23 call options with a strike price of $85 and a premium of $3 per contract. At what price…

A: The call option gives the owner the right to sell an asset at a predetermined price. The call option…

Q: An investor subscribes to a call option with a strike price of 20USD. In May, the shares cost 18USD,…

A: Options contracts are derivatives used by investors to hedge the risk on investments. It is a…

Q: An investor pays $3 to buy a call option on MSFT with a strike price of $45, and receives $2 for…

A: "A strike price is a price at which a derivate contract can be purchased or sold". When the investor…

Q: You purchase one IBM July 250 call contract for a premium of $4 (note that July 90 means contra…

A: The call option is derivative product that derive value from underlying stock and it gives the…

Q: 2. An investor buys a bond for $5,000. The bond pays $125 interest every six months. After 18…

A: A bond refers to the instrument which obligates the issuer to pay pre-defined interest to the buyer.…

Q: A 6-month call option contract on 100 shares of Home Depot common stock with a strike price of…

A: Value of option = (Spot Price - Strike Price) x Number of shares in a contractProfit = Value of…

Q: A CALL has a strike price of $54 and a maturity of six months. what will the profit/loss be to an…

A: A call option is a derivative contract that gives the buyer of the option, the right to buy the…

Q: You purchase AAPL put option with an exercise price of $120 for a premium of $4.5. You hold the…

A: A put option is right to sell the stock at strike price

Q: You observe the following quote for a call option on MSFT. The option has a strike price of $255 and…

A: given, ask price = $7.06 bid price= $6.14 strike price = $255 contract = 9

Q: Explain this step by step: Gerald purchased 3 put option contracts at an option premium of $0.95…

A: Given Information 3 Put option contracts are purchased Option premium = $0.95 1.)Strike Price = $40…

Q: Mr. A bought a put option of 6 months for a price of $50. The strike price is $150. At the end of 6…

A: Strike price is the price at which a stock can be bought or sold.

Q: A 6-month call option contract on 100 shares of Home Depot common stock with a strike price of…

A: Number of shares = 100Strike price = $49.95Stock price = $65.72Cost = $517

Q: You purchase one Ruth April 25 call contract for a premium of $1.8. You hold the option until the…

A: Strike price of the call option = $25Underlying price = $32Option premium = $1.8

Q: You buy a share of Stock A (today) at a price of $50 a share. You intend to hold it for four months.…

A: An investor can reduce the risk of an investment by buying options. A call option gives the investor…

Q: A call option on MassComputer Corp. is trading with a strike price of $100 and an expiration date on…

A: The objective of this question is to calculate the net profit or loss from buying a call option on…