# Put-Call Parity

*Derivatives & Options — Finicade finance glossary*

A no-arbitrage identity tying a call, a put, the stock and a bond into one equation: hold the right combination and two portfolios must cost the same. Break it and there's free money, so it pins down how calls and puts are priced relative to each other.

**Related terms:** [Call Option](https://finicade.com/glossary/call-option), [Put Option](https://finicade.com/glossary/put-option), [Arbitrage](https://finicade.com/glossary/arbitrage), [No-Arbitrage](https://finicade.com/glossary/no-arbitrage)

**Taught in:** Charter Climb — Derivatives: Options & Swaps

Source: https://finicade.com/glossary/put-call-parity