For a(n)________ put option, the higher the share price, the lower the value of the option.
A)European
B)American
C)Asian
D)both A and B

Question

Quizplus · Accepted Answer

For both European and American put options, the value of the option decreases as the share price increases, because the benefit of selling shares at the strike price becomes less attractive compared to selling them at the higher market price. Asian options, which are based on the average price of the underlying asset over a period, do not fit this description as directly because their value is determined differently.

For A(n)________ Put Option, the Higher the Share Price, the Lower