A transaction involving the purchase of a call option on a stock that has already been shorted. This enables the holder to protect against an increase in the price of the underlying stock. If the stock price decreases, the call is not exercised and the investor profits minus the premium. If the stock price increases, the call is exercised and the investor breaks even minus the premium and short interest.
Related information about synthetic put:
- Synthetic Put Definition | Investopedia
Synthetic put combination is to effectively create a synthetic put position that has almost the same risk-reward attributes as a straightforward put position, but with ...
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Nov 16, 2010 ... Why would you go through the hassle of mimicking an instrument instead of simply trading the original? Carley Garner explains the benefits of ...
- What is synthetic put? definition and meaning
Definition of synthetic put: A transaction involving the purchase of a call option on a stock that has already been shorted. This enables the holder to protect ...
- Synthetic Put - Financial Dictionary - The Free Dictionary
Synthetic Put. 0.01 sec. Synthetic put. A strategy equivalent in risk to purchasing a put option where an investor sells stock short and buys a call. Converted Put ...
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The combination of call options and short stocks creates a synthetic put option, ... Synthetic Put: Peter bought 1 contract of Call Options and shorted 100 shares ...
- Synthetic Put Option - YouTube
Mar 30, 2012 ... http://questoptions.com They say options give you options. Well, knowing how synthetics work, give you more options. You see, a synthetic ...
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synthetic put definition: The selling short of an underlying security while a call option is simultaneously purchased on that security. The investor does this if he ...
- Synthetic Put - Tutorial
Synthetic Put. Description. Effectively an insurance policy for covering a short position, the Synthetic Put is the opposite of a Synthetic Call. Basically, we short ...