Many Stock Market Analysts Suggest That Program Trading Was a Big

question 25

True/False

Many stock market analysts suggest that program trading was a big cause of the stock market crash of 1987.

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Definitions:

Puts

Options contracts giving the owner the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Underlying Security

The asset upon which a derivative contract, such as an option, is based.

Option

A financial derivative that represents a contract giving the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified strike price on or before a specified date.