Buying put options allows you to profit when this happens. The exercise price would become one third of what it was and the number of options held would triple. A A protective put strategy is A. Webinar - Corporate Actions an Changing prices reflect the give and take between what buyers are willing to pay and what sellers are willing to accept for the option. Nuy Username or Password?
What is your email? A or B D The price that the writer of a call OR put option receives oprion the buy out of the money put option holder asset if the buu executes her option is called the A. A or C E The price that the writer of a put option receives for the underlying asset if the option is exercised is called the A. E A European call option allows the buyer to A.
D An American put option allows the holder to A. E A European put option allows the holder to A. A To adjust for stock splits A. B All else equal, bjy option values are higher A. A Lookback options have payoffs that A. A Barrier Options have payoffs that A. E Binary Options A. A and B only. A, B, and C. C The maximum loss a buyer of a stock call option can suffer is equal to A. C The maximum loss a buyer of a stock put option can suffer is equal to A. D The lower bound on the market price of a convertible bond is A.
B The intrinsic value of an out-of-the-money call option is equal to A. B The intrinsic value of an at-the-money call option is equal to A. C The intrinsic value of an in-of-the-money call option is equal to A. D The intrinsic value of an in-the-money put option is equal to A. C The intrinsic value of an at-the-money put option is equal to A. C The intrinsic value of an out-of-the-money put option is equal to A.
Ignoring transactions costs, what is the breakeven price of this position? Ignoring transaction costs, the break-even price of the position is A. C Buyers of call options pose no risk as they have no commitment. If the option expires worthless, the buyer merely loses the option premium. If the option is in the money at expiration and the buyer lacks funds, there is no buy out of the money put option holder to exercise. The seller of a put option is committed to selling the stock at the exercise price.
If the seller of the option does not own the underlying stock the seller must go into the open market and buy the stock in order to be able to sell the stock to the buyer of the contract. Likewise, the seller of the call option hopes the price will decrease so the option will expire worthless. D A covered optiion position is A. B With a short put, the seller of the contract must buy the stock if the option is exercised; however, this cash outflow is offset by the premium income as in the covered call scenario.
A covered call position is equivalent to a A. A A protective put strategy is A. Ignoring commissions, the holder of the call option will earn a profit if the price of the share A. C A vertical or money spread involves the purchase one option and the simultaneous sale of another with a different exercise price and same expiration date. Your strategy is known as A. C A horizontal or time spread involves the simultaneous purchase and sale of off with different expiration dates, same exercise price.
B Before expiration, the time value of a call monwy is equal to A. E Which of the following factors affect the price of a stock option A. C The value of a stock put option is positively related to the following factors except A. E The value of a stock put option is positively related to A. What is the maximum profit that you could gain from this strategy? The maximum potential profit of your strategy is A. B You buy one Xerox June 60 call contract and one June 60 put contract.
Your strategy is called A. Your maximum loss from this position could be A. E Some more "traditional" assets have option-like features; some of these instruments include A. D Financial engineering A. D A collar with a net outlay of approximately zero is an options strategy that A. C Asian options differ from American and European options in that A. B Trading in "exotic options" takes place A. D Derivative securities are also called contingent claims because A. If the call is not exercised, there is no gross profit and the investor loses the full amount of the premium.
If you exercise the call today, what will be your holding period return? If you do uolder exercise the call today and it expires, what will be your holding period return? It doesn't matter - they are too risky to be included in a reasonable person's portfolio. There is no change in holdre the exercise price or in the number of options held. The exercise price will adjust through normal market movements; the number of options will remain the oht.
The exercise price would become half of what it was and the number of options held would double. The exercise price would double and the number of options held ootion double. There is no standard rule - each corporation has its own policy. C What happens to an option if the underlying stock has a 3-for-1 split? The exercise price would become one third of what it was and the number of buy out of the money put option holder held would triple.
The exercise price would triple and the number of options held would triple. D When an index option is exercised the writer of the option pays cash to the option holder. The amount of cash equals the difference between the exercise price of the option and the value of the index. In other words, you are implicitly buying the index for and selling it to the call writer for The option has an exercise price of and the index is now at What will happen when you exercise the option?
B When an index option is exercised the writer of the option pays cash to the option holder.
Put Options Trading for Beginners in 10 min. - Call and Put Options Explained
What is an Option? the option holder has the right to sell the option to another buyer during A put option is out-of-the-money if its underlying price is. Options Out of the Money. Options contracts give the holder the right to buy or sell an underlying Buying out-of-the-money put options can offer some. FIN - exam 2 options notes. An American put option allows the holder to A. buy the underlying asset The intrinsic value of an out-of-the-money put option.