If an Investor Constructs a Covered Call

question 11

Multiple Choice

If an investor constructs a covered call,

• A)there is no limit to the potential profit
• B)risk is increased
• C)risk is reduced
• D)the term of the position is increased

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Definitions:

Outermost Layer

The outermost layer refers to the surface or external layer of an object or body, which is directly exposed to the environment.

Iliac Crest

The curved upper border of the ilium, the largest bone of the pelvis, important as a landmark for various surgical and clinical procedures.

Quadratus Lumborum

A muscle in the lower back on either side of the lumbar spine that helps in bending the trunk sideways.

Vertebral Column

The flexible and strong spine consisting of a series of vertebrae, extending from the skull to the small of the back, providing support and forming the central part of the skeleton.