You enter into an exchange option contract where you have the right to give up 5 shares of IBM stock in exchange for one share of Google in three months. After three months, IBM is trading at $92 per share while Google is at $430. The payoff at maturity is
A) $- 30$ .
B) Zero.
C) $+ 6$ .
D) $+ 30$ .

Question

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The Answer of You enter into an exchange option contract where you have the right to give up 5 shares of IBM stock in exchange for one share of Google in three months. After three months, IBM is trading at $92 per share while Google is at $430. The payoff at maturity is
A) $- 30$ .
B) Zero.
C) $+ 6$ .
D) $+ 30$ .

You Enter into an Exchange Option Contract Where You Have −30- 30−30

You Enter into an Exchange Option Contract Where You Have $- 30$