Roshivee wants to invest in the share of blue chip companies. However, due to the expected outbreak of war between two countries, an investment advisor suggested him to invest through option contract. He expects that the

Given Information: Present futures contract price (which can be considered the strike price for the put option in this context, as the cost is based on it) = ₹ 100 Cost of put option (premium) = 1.5% of the strike price = 1.5% of ₹ 100 = ₹ 1.50 per share Share price went down to = ₹ 97 Number of option contracts = 1,50,000 (assuming each contract represents one share for simplicity in calculation, or if it means 1,50,000 shares covered by options) Calculation of Gain/Loss per Share: Since Roshivee bought a put option and the share price (₹ 97) is below the strike price (₹ 100), the option is "in the money" and will be exercised. Gain from exercising the put option per share = Strike Price - Market Price = ₹ 100 - ₹ 97 = ₹ 3 Premium paid per share = ₹ 1.50 Net Gain per share = Gain from exercising - Premium paid = ₹ 3 - ₹ 1.50 = ₹ 1.50 Calculation of Total Gain/Loss on 1,50,000 Option Contracts (or shares): Total Gain = Net Gain per share × Number of Option Contracts (or shares) Total Gain = ₹ 1.50 × 1,50,000 = ₹ 2,25,000 Therefore, the total gain on 1,50,000 option contracts (or shares) would be ₹ 2,25,000 .