What is put option price on abc with same exercise price

Assignment Help Financial Management

Reference no: EM131569967

The current price of ABC Co. is $66 a share and its (annualized) standard deviation is 45%. ABC won’t pay any cash dividends within six months. A 6-month call option on ABC stock with a $65 exercise price is selling for $3. What is the put option price on ABC with the same exercise price ($65) and expiration date (6 months). Assume the risk-free rate is 5 percent and use continuous compounding.

Reference no: EM131569967

Questions Cloud

Why would fund statements not include long-lived assets : Why would fund statements not include long-lived assets? What is meant by the term fiduciary duty in the case of these three trust funds

Which can be understood in terms of two distinct regions : In what ways might differences in Physical Geography be responsible for differences in social, economic, political, and cultural institutions?

Discuss internal controls contributed to the scandal : Choose one accounting scandal that precipitated this legislation and discuss whether or not internal controls (or lack thereof) contributed to the scandal

Issue of age discrimination : How do school districts ensure that they have addressed the issue of age discrimination?

What is put option price on abc with same exercise price : What is the put option price on ABC with the same exercise price ($65) and expiration date (6 months).

Create a memorial to the military personnel who have died : Who was the gay male artist who used abjection both to draw attention to sexual difference and renounced organized Catholicism?

Explore three of these issues listed : Explore three of these issues listed or chooses others that are of interest to you and describe the issue, identify why it is relevant to HR departments

The indirect method of the statement of cash flows : Which of the following identifies a key difference between the direct method and the indirect method of the statement of cash flows?

Determining the educational goals : This exercise is designed to help you take a constructive approach to those judgements and discover what works for you as you pursue.

User Account

All Pages