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John purchases a call option with a strike price of $110 that is selling for $3.50 when the stock is trading at $108 per share. what is the intrinsic value of the call option
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May 6, 2019
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John purchases a call option with a strike price of $110 that is selling for $3.50 when the stock is trading at $108 per share. what is the intrinsic value of the call option
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MMiroslav
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The intrinsic value of a call option can be calculated by subtracting the strike price from the market price ($108-$110=?). Therefore the intrinsic value of John's call option is $-2 or 0.
Yogesh Rathi
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May 10, 2019
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