A decrease in the current value of the underlying security will increase the value of a put option.

Name: A decrease in the current value of the underlying security will increase the value of a put option.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A put option gives the holder the right to sell the underlying security at a specified price. If the current value of the security decreases, the put option becomes more valuable because the holder can sell the security at a higher price than the current market price.

A Decrease in the Current Value of the Underlying Security