- D. A would be correct for an in-the-money option.
- A. II is at-the-money, not in it.
- A. The others are bearish strategies.
- D. The rest are false.
- C. The rest are false.
- B. Strangles use different strike prices, both of which are out of the money.
- A. Straddles are used when the investor is unsure of the market's direction
- B. Strike price + net premium. The mnemonic device is Calls Add to Lower (CAL)
- C A is incorrect as synthetic options utilize a combination of futures and options. A future obligates buyer and seller alike, whereas options obligate only sellers.
TradingParticipate in options trading trading that is simpler, less expensive and easier to manage.
TradingHere is a quick introduction to four options strategies that traders should know.
TradingLearn how long straddles, long strangles and vertical debit spreads can help you profit from the volatility that stock analysts expect for 2016.
TradingForget straddles. These strangles are both liberating and legal in the investing world.
TradingWe explain four key strategies to profit fom volatility in markets.
TradingDuring times of volatility, traders can benefit greatly from trading options rather than stocks. We explain why.
TradingIn this strategy, traders cash in when the underlying security rises - and when it falls.
InvestingLearn more about stock options, including some basic terminology and the source of profits.
InvestingDiscover the option-writing strategies that can deliver consistent income, including the use of put options instead of limit orders, and maximizing premiums.
TradingWe'll show you how to ace the largest and most difficult section of this exam.