Which One of the Following Options Is Out of the Money

question 24

Multiple Choice

Which one of the following options is out of the money?

• A)call with a $20 strike and a stock price of $21
• B)put with a $35 strike and a stock price of $33
• C)call with a $45 strike and stock price of $46
• D)put with a $75 strike and a stock price of $70
• E)call with a $50 strike and a stock price of $49

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Definitions:

Fully-Funded Pension Plan

A pension plan that has enough assets to provide for all accrued benefits owed to participants.

Equities

Shares of ownership in a company, representing a claim on part of the company's assets and earnings.

Contingent Immunization

A mixed passive-active strategy that immunizes a portfolio if necessary to guarantee a minimum acceptable return but otherwise allows active management.

Risk Tolerance

An investor's ability or willingness to endure market volatility and potential loss in the value of investments.