Caleb sold a put option on Canadian dollars for $.05 per unit. The strike price was $.85, and the spot rate at the time the option was exercised was $.92. Assume Caleb immediately sold off the Canadian dollars received when the option was exercised. Also assume that there are 50,000 units in a Canadian dollar option. What was Caleb’s net profit on the put option?

/in /by

Caleb sold a put option on Canadian dollars for $.05 per unit. The
strike price was $.85,

and the spot rate at the time the option was exercised was $.92.
Assume Caleb

immediately sold off the Canadian dollars received when the option was
exercised. Also

assume that there are 50,000 units in a Canadian dollar option. What
was Caleb’s net

profit on the put option?

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