If the hedge ratio for a stock call is 0.60, the hedge ratio for a put with the same expiration date and exercise price as the call would be
A) 0.60.
B) 0.40.
C) −0.60.
D) −0.40.
E) −0.17.

Question

Quizplus · Accepted Answer

The hedge ratio for a put option is the negative of the hedge ratio for a call option with the same expiration date and exercise price. Therefore, if the call option's hedge ratio is 0.60, the put option's hedge ratio would be -0.40.

If the Hedge Ratio for a Stock Call Is 0