- CFA Exams
- CFA Exam: Level I 2021
- Study Session 16. Derivatives
- Reading 49. Basics of Derivative Pricing and Valuation
- Subject 12. American Option Pricing
CFA Practice Question
Which factors DISCOURAGE early exercise of American puts?
II. Storage costs if the underlying is a commodity
III. Coupon interests if the underlying is a bond
I. Dividends if the underlying is a stock
II. Storage costs if the underlying is a commodity
III. Coupon interests if the underlying is a bond
Correct Answer: I and III
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