Which of the following is a false statement? When one writes a put option, he is
ID: 2638107 • Letter: W
Question
Which of the following is a false statement?
When one writes a put option, he is taking a short position of the put option.
When options are exercised, the company does not issue new shares of its own stock.
If one holds an American option, he can exercise the option at any time before expiration.
Exercising an in-the-money option results in a profit.
When one writes a put option, he is taking a short position of the put option.
When options are exercised, the company does not issue new shares of its own stock.
If one holds an American option, he can exercise the option at any time before expiration.
Exercising an in-the-money option results in a profit.
Explanation / Answer
When options are exercised, the company does not issue new shares of its own stock.
When options are exercised, the company does not issue new shares of its own stock.