Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

The time value of the option is most likely: A. Zero. B. A positive amount. C. A negative amount.

An investor purchases a1-month out-of-the-money American call option on a stock. A week later, the stock price is less than the call option strike price.

user-image
Question added by Vinod Jetley , Assistant General Manager , State Bank of India
Date Posted: 2014/10/25
VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

A POSITIVE AMOUNT

Vinod Jetley
by Vinod Jetley , Assistant General Manager , State Bank of India

B.

K.CHANDRA MOHAN 'Aavanishree',
by K.CHANDRA MOHAN 'Aavanishree', , Project / Programme Officer , Government

I think it is a Negative Price in that the Share price is higher than the stock price.

Ibrahim Hussein Mayaleh
by Ibrahim Hussein Mayaleh , Sales & Business Consultant and Trainer , Self-employed

(B) Positive amount

More Questions Like This

Do you need help in adding the right keywords to your CV? Let our CV writing experts help you.