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Derivatives and Risk Management, 1st Edition
book

Derivatives and Risk Management, 1st Edition

by Sundaram Janakiramanan
May 2024
Intermediate to advanced content levelIntermediate to advanced
542 pages
27h 26m
English
Pearson India
Content preview from Derivatives and Risk Management, 1st Edition
282 Derivatives and Risk Management
12.17 Comparison Between the Gains Made by
a Put Buyer and a Put Writer
For an option buyer, the maximum loss is the option price paid by them for buying the option and the
maximum gain is the exercise price when the stock price is close to zero. For the option writer, the gain
is the maximum option price received by them at the time of writing the call, but the loss can be as high
as the exercise price. However, the gains of the writer are the losses of the buyer, and vice versa. us, an
option is a zero-sum game between the option writer and the option buyer. In addition, it can be seen
that the ter
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Publisher Resources

ISBN: 9781299447547Publisher Website