Question

If an investor writes 2 DWQ Jan. 60 puts at 3 in September and the investor buys back the 2 puts at 4.50 two months later, the result for tax purposes is a:

A) $150 short-term capital gain.
B) $300 short-term capital gain.
C) $150 short-term capital loss.
D) $300 short-term capital loss.

Answer 1

The result for tax purposes is a $300 short-term capital loss.

Step-by-step explanation:

The result for tax purposes when an investor writes 2 DWQ Jan. 60 puts at 3 in September and buys them back at 4.50 two months later is a $300 short-term capital loss.

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