Put-call parity

Definition:

Applies to derivative products. Option pricing principle that says, given a stock's price, a put and call of the same class must have a static price relationship because arbitrage opportunities or activities will always reestablish such a relationship.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Arizona Stock Exchange

A single price auction exchange for equity trading that allows anonymous buyers and sellers to trade at low transaction costs.

Subscribe to the Term of the Day via email Get the Term of the Day in your inbox!


Create your free portfolio