Use some options protection

Assignment Help Financial Management

Reference no: EM131928571

Apple’s share price reached a high of $705 in September 2012 when the iPhone 5 was released, but fell to $505 two months later. Some analysts claimed it could fall another 30 to 50% (to the $250-350 range). In December 2012 investors were advised on Yahoo Finance that: “ if you own a lot of APPL … it's time to lighten up your holdings or use some options protection.”

If you owned Apple shares at the time, what exactly, did that advice recommend that you should do?

Reference no: EM131928571

Questions Cloud

Calculate the price of an at the money call : If the risk-free rate of interest is 10%, calculate the price of an “at the money” call.

Explain the cash conversion cycle : Explain the cash conversion cycle (CCC). Describe the CCC for your employer or company in an industry in which you're interested.

Formula for macaulay duration and price of bond : Write down and briefly explain the relation between the formula for Macaulay duration and the price of a bond.

Calculate the current price and duration of each bond : Calculate the current price and duration of each bond. Calculate the shares of Bonds 1 and 3 in an optimal immunized portfolio.

Use some options protection : it's time to lighten up your holdings or use some options protection.

What is arbitrage argument : What is “arbitrage”? Give an example of the use of an “arbitrage argument”.

Find the gross margin-ebit-net income and current assets : FIND the Gross Margin, EBIT, Net Income, Current Assets, Current Ratio, Cash Flow From Assets, Effective total corporate tax rate.

What is its accounts receivable balance : Baker Brothers has a DSO of 19 days, and its annual sales are $10,585,000. What is its accounts receivable balance?

Balance of current assets on the firm balance sheet : What is the balance of current liabilities on the firm's balance sheet? What is the balance of current assets on the firm's balance sheet?

User Account

All Pages