If the hedge ratio for a stock call is 0.50, the hedge ratio for a put with the same expiration date and exercise price as the call would be
A)0.30.
B)0.50.
C)-0.60.
D)-0.50.
E)-.17.

Name: If the hedge ratio for a stock call is 0.50, the hedge ratio for a put with the same expiration date and exercise price as the call would be A)0.30. B)0.50. C)-0.60. D)-0.50. E)-.17.
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Question

Quizplus · Accepted Answer

Call hedge ratio = N(d1); Put hedge ratio = N(d1) - 1; 0.5 - 1.0 = -0.5.

If the Hedge Ratio for a Stock Call Is 0