Studies Have Shown That Most of Us Do Not Recommend

question 96

True/False

Studies have shown that most of us do not recommend risky options when we are alone with a person who is asking for advice.

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Definitions:

Call

An option contract giving the owner the right, but not the obligation, to buy a specified amount of an underlying asset at a set price within a specified time.

Positive Intrinsic Value

The condition where an option or other financial instrument has a market price below its calculated value, suggesting undervaluation.

In-the-Money

An option is considered in-the-money when it has intrinsic value, meaning that for a call option the market price of the asset is above the strike price, and for a put option, it's below the strike price.

Strike Price

The fixed price at which an option's holder has the right to purchase (if a call option) or sell (if a put option) the underlying asset or commodity.