Put-call parity exists when the call and the put on the same stock for the same strike price and same expiration date have the same price.

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Put-call parity is a financial principle that defines a specific relationship between the price of a European call option and a European put option of the same class, that is, with the same underlying asset, strike price, and expiration date. It does not imply that the call and put options have the same price, but rather that their prices are related in a way that prevents arbitrage opportunities. The relationship is given by the formula: C - P = S - PV(K), where C is the price of the call option, P is the price of the put option, S is the current price of the underlying asset, PV(K) is the present value of the strike price (K), discounted at the risk-free interest rate.

Put-Call Parity Exists When the Call and the Put on the Same