Which of the Following Statements Is Accurate Concerning Knock-Out Call

question 4

Multiple Choice

Which of the following statements is accurate concerning knock-out call options?

• A)The delta is positive if it is a down-and-out call but can be positive or negative if it is an up-and-out call.
• B)The delta can be positive or negative,but the gamma is always positive.
• C)The delta is always positive,but the gamma can be positive or negative.
• D)The delta can be positive or negative and the gamma can also be positive or engative.

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Definitions:

Performance Measures

Criteria or metrics used to assess, compare, and track the efficiency, effectiveness, or success of an investment or business operation.

Sharpe Measure

The Sharpe Measure assesses the risk-adjusted return of an investment, comparing its excess return over the risk-free rate to its standard deviation of returns.

Standard Deviation

A measure of the dispersion or variability of a set of values, used in finance to gauge the risk associated with an investment's return.

Beta

An indicator of the degree of variability or systematic risk associated with a security or portfolio relative to the broader market.