The Spot Price of the Market Index Is $900

Multiple Choice

The spot price of the market index is $900. After 3 months the market index is priced at $920. The annual rate of interest on treasuries is 4.8% (0.4% per month) . The premium on the long put, with an exercise price of $930, is $8.00. Calculate the profit or loss to the short put position if the final index price is $915.

A) $15.00 gain
B) $15.00 loss
C) $6.90 gain
D) $6.90 loss