The Owner of a Large, Diversified Stock Portfolio Could Hedge

question 88

Multiple Choice

The owner of a large, diversified stock portfolio could hedge against a steep decline in prices by

• A) buying call options on a stock index.
• B) buying put options on a stock index.
• C) selling put options on a stock index.
• D) buying both call and put options with the same expiration date.

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Definitions:

Psychotropic Medications

Psychotropic Medications are drugs that affect brain chemistry and are used to treat mental health disorders, including antidepressants, antipsychotics, and mood stabilizers.

Biological Treatments

Medical approaches to treating psychiatric disorders that affect the brain's chemistry, structure, or functioning, including medication and surgery.

1950s

A decade characterized by post-World War II recovery, the beginning of the Cold War, and significant cultural, economic, and technological changes worldwide.

Somatogenic Perspective

A viewpoint in psychology and psychiatry that suggests mental disorders originate from biological or physiological causes.