The writer of a put option loses if the stock price declines.

Name: The writer of a put option loses if the stock price declines.
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Question

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The writer of a put option has the obligation to sell the underlying asset at the strike price if the option is exercised. If the stock price declines, the writer of the put option will have to sell the asset at a price lower than the market price, resulting in a loss.

The Writer of a Put Option Loses If the Stock