Assume you bought a put on a stock selling for $60, with a strike price of $55 for a $5 premium. what would be your maximum gain? a) 50 b) 55 c) 60 d) 65 A put with a strike price of $75 sells for $10. which of the following statements is least accurate? The greatest: a) profit the writer of the put option can make is $10 b) profit the buyer of a put option can make is $65 c.) loss the writer of a put option can have is $75 Loss to the buyer of a put is $10 Which of the following combinations of options and underlying investments have similarly shaped profit/loss diagrams? A: a) covered call and protective put b) covered call, and a short stock combined with a long call c) short put option combined with a long call option, and a protective put d) long call option combined with a short put option, and a long stock position
A C Not sure about the 3rd one
a c d
nice saruya
For first 1. the question is real twisted. you dont have any gain, until stock falls below 50, only then you start gaining… and the most it can fall is 0 so the most you gain is 50. C (this one tricky too, but common sense prevails) haven’t done this part.