The maximum loss a buyer of a stock put option can suffer is equal to
A)the striking price minus the stock price.
B)the stock price minus the value of the call.
C)the put premium.
D)the stock price.
E)none of the above.

Question

Quizplus · Accepted Answer

The maximum loss for a buyer of a stock put option is limited to the premium paid for the option, which is the cost of purchasing the put.

The Maximum Loss a Buyer of a Stock Put Option