If the option is held to maturity under what conditions


Suppose a European call option to buy a share for $100.00 costs $5.00. The stock currently trades for $97.00. If the option is held to maturity under what conditions does the holder of the option make a profit? Note: ignore time value of money.

  • When the price of the stock is greater than $102.
  • When the price of the stock is greater than $105.
  • When the price of the stock is greater than $100.

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Finance Basics: If the option is held to maturity under what conditions
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