What Do You Call a Combination of a Long (Short)

question 240

Multiple Choice

What do you call a combination of a long (short) call option and short (long) put option with same face value, same expiration date, same style, where the strike price is equal to the forward price?

• A) a synthetic forward
• B) a straddle
• C) risk reversal
• D) a strangle

---

Definitions:

James-Lange Theory

A hypothesis suggesting that emotions occur as a result of physiological reactions to events, implying that the body's responses precede and induce emotional experiences.

Facial Expressions

Visually observable configurations of facial muscles that convey a person's emotions or intentions.

Increasing Empathy

The process of developing a greater ability to understand and share the feelings of others.

Yearly Salary

The total amount of money earned by an individual from their job or profession over the course of a year.