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.
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.
  No. Lara is long a put. Therefore she has rights, not obligations.

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