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For this case study, we assume that Nikkei Index is a tradable securities just like usual stock. No fee or tax are considered in this case. On October 1, you purchased Nikkei Index at a price of 31,100 JPY ("Long Position"). On October 1, Nikkei Index "Put" Options are traded with various strike prices as follows: Price of Put Option 305 210 120 50 30 15 Price Underlying: Call or Put : Maturity : American or European : 31,300 31,200 31,100 31,000 30,900 Nikkei Index on Dec.8 Nikkei Index Put Dec. 8 European 31,100 (Sample Question 1) You buy the Put Option of strike price 31,100. What is your total payoff (Long Nikkei and Put Option) at maturity if the stock price is shown below. Money paid to purchase Put Option Strike Price Initial money paid to hold Long Position Strike Price 31,400 31,300 31,200 31,100 31,000 30,900 Payoff from Put Payoff from Option (if Long Position exercised) (if no exercise) Total Payoff

For this case study, we assume that Nikkei Index is a tradable securities just like usual stock. No fee or tax are considered in this case. On October 1, you purchased Nikkei Index at a price of 31,100 JPY ("Long Position"). On October 1, Nikkei Index "Put" Options are traded with various strike prices as follows: Price of Put Option 305 210 120 50 30 15 Price Underlying: Call or Put : Maturity : American or European : 31,300 31,200 31,100 31,000 30,900 Nikkei Index on Dec.8 Nikkei Index Put Dec. 8 European 31,100 (Sample Question 1) You buy the Put Option of strike price 31,100. What is your total payoff (Long Nikkei and Put Option) at maturity if the stock price is shown below. Money paid to purchase Put Option Strike Price Initial money paid to hold Long Position Strike Price 31,400 31,300 31,200 31,100 31,000 30,900 Payoff from Put Payoff from Option (if Long Position exercised) (if no exercise) Total Payoff

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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For this case study, we assume that Nikkei Index is a tradable securities just like usual stock. No fee or tax are considered in this case. On October 1, you purchased Nikkei Index t a price of 31,100 JPY ("Long Position"). On October 1,Nikkei Index "Puť" Options are traded with various strike prices as follows: Underlying: Price of Put Option Call or Put : 305 210 120 Price Maturity : American or European : Nikkei Index on Dec.8 31,300 31,200 31,100 31,000 30,900 Nikkei Index Put Dec. 8 European Money paid to purchase Put Option Strike Price 31,100 (Sample Question 1) You buy the Put Option of strike price 31,100. What is your total payoff (Long Nikkei and Put Option) at maturity if the stock price is shown below. Initial money paid to hold Long Position Strike Price 31,400 31,300 31,200 31,100 31,000 30,900 50 30 15 Payoff from Put | Payoff from Option (if Long Position exercised) (if no exercise) Total Payoff
Transcribed Image Text:For this case study, we assume that Nikkei Index is a tradable securities just like usual stock. No fee or tax are considered in this case. On October 1, you purchased Nikkei Index t a price of 31,100 JPY ("Long Position"). On October 1,Nikkei Index "Puť" Options are traded with various strike prices as follows: Underlying: Price of Put Option Call or Put : 305 210 120 Price Maturity : American or European : Nikkei Index on Dec.8 31,300 31,200 31,100 31,000 30,900 Nikkei Index Put Dec. 8 European Money paid to purchase Put Option Strike Price 31,100 (Sample Question 1) You buy the Put Option of strike price 31,100. What is your total payoff (Long Nikkei and Put Option) at maturity if the stock price is shown below. Initial money paid to hold Long Position Strike Price 31,400 31,300 31,200 31,100 31,000 30,900 50 30 15 Payoff from Put | Payoff from Option (if Long Position exercised) (if no exercise) Total Payoff
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