Calculate value of a five month european put futures option

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Reference no: EM131237669

1. Calculate the value of a five-month European put futures option when the futures price is $19, the strike price is $20, the risk-free interest rate is 12% per annum, and the volatility of the futures price is 20% per annum.

2. Suppose you buy a put option contract on October gold futures with a strike price of $1,200 per ounce. Each contract is for the delivery of 100 ounces. What happens if you exercise when the October futures price is $1,180?

Reference no: EM131237669

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