You own both a May 20 call and a May 20 put.If the call finishes in the money,then the put will:
A)also finish in the money.
B)finish at the money.
C)finish out of the money.
D)either finish at the money or in the money.
E)either finish at the money or out of the money.

Question

Quizplus · Accepted Answer

If the call option finishes in the money, the stock price has increased above the strike price of the call option, meaning the put option will expire out of the money as it is betting on the stock price decreasing. Therefore, choice C is correct.

You Own Both a May 20 Call and a May