A Put Option Gives the Owner ________

question 96

Multiple Choice

A put option gives the owner ________.

• A) the right to sell the underlying security
• B) the obligation to sell the underlying security
• C) the right to buy the underlying security
• D) the obligation to buy the underlying security

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Definitions:

Annual Fees

Charges that must be paid yearly for membership or participation, often associated with credit cards, investment funds, and various types of subscriptions.

Futures

Financial contracts obligating the buyer to purchase an asset, or the seller to sell an asset, at a predetermined future date and price.

Options

Financial derivatives that provide the holder the right, but not the obligation, to buy or sell an asset at a predetermined price on or before a specific date.

ETFs

Exchange-Traded Funds are investment funds traded on stock exchanges, much like stocks, and hold assets such as stocks, commodities, or bonds.