put option profit# Stock
G*G
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It is important for us to know our profit before we buy the option put.
For example, for 100 stock XYZ, the strike price is $48, premium is $0.05
if the stock price goes down to $45, how much can you earn?
The formula is quite easy.
Profit = number of shares * (strike price - premium price - current stock
price)
Therefore, the answer to the question above is
100 * (48-0.05-45) = $295
Hope you enjoy it.
For example, for 100 stock XYZ, the strike price is $48, premium is $0.05
if the stock price goes down to $45, how much can you earn?
The formula is quite easy.
Profit = number of shares * (strike price - premium price - current stock
price)
Therefore, the answer to the question above is
100 * (48-0.05-45) = $295
Hope you enjoy it.