The relationship between the prices of the underlying stock,a call option,a put option,and a riskless asset is referred to as the ________ relationship.

Question

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Put-call parity is the relationship that exists between the prices of a call option, a put option, and the underlying stock. This relationship helps ensure that there are no arbitrage opportunities in the market. The relationship also involves a riskless asset, which is used to balance out the equation. Covered call, protective put, straddle, and strangle are all option trading strategies and do not refer to the relationship between the prices of the underlying stock and options.

The Relationship Between the Prices of the Underlying Stock,a Call