Price of put options profit&loss


A profit and loss diagram, or risk graph, is a visual representation of the possible profit and loss of an option strategy atThis article needs additional citations for verification. Please price of put options profit&loss improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed.

(November 2015) ( Learn how and when to remove this template message)In finance, a put or put option is a stock market device which gives the owner of a put the right, but not the obligation, to sell an asset (the underlying), at a specified price (the strike), by a predetermined date (the expiry or maturity) to a given party (the seller of the put). A put is an option contract that gives the owner the price of put options profit&loss, but not the obligation, to sell 100 shares of the underlying stock at a specified price (which is known as the strike price of the put) at any time before a specific time (the expiration date of the put).Bearish traders would use puts because the value of the put should go up if the price of the underlying stock goes down.

You have the right to purchasethe TV for the sale price up to 1 month regardless of how much theTV goes up or down in price during that period. You are the buying thiscall option and Wal Mart is the seller. The investor is very concerned that the price may be too high so she buys 7 put option contracts to offset some of the risk of the stock price falling.

If she does indeed sell all 7 of the put option contracts, how much will she make (or lose) on the option. Solution PreviewPlease see the attached file.An investor owns 1000 shares of SoftKiss Lipstick Company. The investor is very concerned that the price may be too high so she buys 7 put option contracts to offset some of the risk.




Price of put options profit&loss

Price of put options profit&loss