Option investor D sells (writes, takes a SHORT position in) one of the following call options: Type of option: call option Underlying asset: 100 shares of Disney stock Exercise price: $40 per share Premium : $2.25 per share Expiration date : January The current market price of Disney stock is $39.02 per share. Investor D already owns 500 shares of Disney stock. Which of the following describes the amount of initial margin required for this transaction()
A. Since the call option is "in the money" investor D is not required to deposit initial margin.
B. Since investor D owns at least 100 shares of Disney stock, he must deposit initial margin in the amount of 100% of the option premium.
C. Since investor D owns at least 100 shares of Disney stock, no additional margin is required.
