1- Which creates a STRANGLE? A-Buy two $55 puts, buy one $55 call B-Buy one $55

ID: 2768662 • Letter: 1

Question

1- Which creates a STRANGLE?

A-Buy two $55 puts, buy one $55 call

B-Buy one $55 put, buy one $65 put and sell two $60 puts

Buy one $55 put, buy one $65 call

C-Sell two $55 puts, buy one $60 put and buy one $65 put.

D-Sell one $55 put, buy one $60 call

6- Which of the following can be used to create a short position in a European call option on a stock?

A-Sell the stock and buy a put option (with borrowing).

B-Buy the stock and buy a put option (with borrowing).

C-Buy the stock and sell a put option (with lending).

D-Sell the stock and sell a put option (with lending).

1. A STRANGLE is created when the following happens:

The correct answer is option B: Buy one $55 put, buy one $65 call

6. A short position in a European call options on a stock is as follows:

The correct answer is option B: Buy the stock option and buy a put option (with borrowing)

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