On october 19 1987 the stock market as measured by the dow, Ask an Expert

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On October 19, 1987, the stock market (as measured by the Dow Jones Industrial Average) lost almost one-quarter of its value in a single day. Nevertheless, some traders made a profit buying call options on the stock index and then liquidating their positions before the market closed. Explain how this is possible, assuming that it was not a case of the traders taking advantage of spurious upward ticks in stock prices.

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Category:- Basic Finance
Reference No.:- M91609759

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