Chapter 02 · Section 2.1

Long DM Puts-1

Lara is long 4 PHLX DM June 45 puts.

Lara has:

• a) the right to sell Deutsche Marks at $.45/DM but no obligations.
  Yes. Lara is the holder or owner of 4 put options allowing her to sell a total of DM 250,000 at $.45/DM. (Each PHLX contract = 62,500 DM) Continue
  b) the obligation to sell Deutsche Marks at $.45/DM if she is exercised.
  c) the right to buy at $.45/DM but no obligations.
  d) the obligation to buy at $.45/DM if she is exercised.

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