Option Sellers

question 86

Multiple Choice

Option sellers:

• A)are not required to make margin payments
• B)must own the underlying shares
• C)must make margin payments to ensure they can meet their obligations
• D)cannot lose more than the option premium.
• E)None of the above is correct.

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Definitions:

Subsidiaries

Companies that are controlled by another company, known as the parent company, through ownership of more than 50% of the subsidiary's voting stock.

Non-executive Director

A member of a company's board of directors who is not part of the executive team, providing oversight and valuable perspective without managing day-to-day operations.

Related Party

A person or entity that is related to the entity that is preparing its financial statements.

Controlling Investment

A significant ownership interest in a company, providing the ability to exercise control over its operations and policies.