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Briefly Explain Why a Call Option Is Always Riskier Than

question 49

Essay

Briefly explain why a call option is always riskier than a simple investment in the underlying stock.


Definitions:

Dopamine

A neurotransmitter in the brain that plays a key role in regulating mood, motivation, pleasure, and reward.

Endorphins

These are neurotransmitters produced in the brain that act as natural painkillers and are also associated with feelings of pleasure and well-being.

Serotonin

A neurotransmitter that contributes to feelings of well-being and happiness, also involved in regulating mood, appetite, and sleep.

Sympathetic

Pertaining to the part of the autonomic nervous system that typically increases bodily readiness for action in response to stress.

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