An Investor Purchased a Put Option and at the Same

question 52

Multiple Choice

An investor purchased a put option and at the same time wrote a put option at an exercise price lower than that of the long put option.The strategy is known as a:

• A) long straddle.
• B) bull spread.
• C) put bear spread.
• D) short straddle.

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Definitions:

Forcible

Done by force, often implying the use of physical strength or violence.

Muscle

Tissue in the body that contracts to allow movement of parts of the body.

Gluteus Maximus

The largest and strongest muscle in your body, located in the buttocks, responsible for movement of the hip and thigh.

Extends

To stretch out or spread from one point to another.