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Consider a Position in Options on a Particular Stock

Question 13

Multiple Choice

Consider a position in options on a particular stock.The position has a delta of 12 and the stock price is 10.Which of the following is the approximate relation between the change in the portfolio value in one day,dP,and the return on the stock during the day,dx


A) dP=12dx
B) dP=1.2dx
C) dP=120dx
D) dP=22dx

Correct Answer:

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