A put option is a wasting asset; i.e., its value declines with the passage of time, all else equal.

Name: A put option is a wasting asset; i.e., its value declines with the passage of time, all else equal.
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Question

Quizplus · Accepted Answer

A put option, like all options, has a finite life and its value decreases as it approaches its expiration date due to time decay, assuming all other factors remain constant.

A Put Option Is a Wasting Asset; I