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Beginner Level Review

Question 1:

True or False: A call option gives the holder (buyer) the right but not the obligation to BUY the currency at the strike price

Question 2:

True or False: A put options gives the holder (buyer) the right but not the obligation to BUY the currency anywhere above the strike price

Question 3:

If an option is in the money, then what is true:

  • a) If the option is exercised, there is no cash settlement value
  • b) if the option is exercised, there is only time value available to the trader
  • c) if the option is exercised, there is only intrinsic value available to the trader
  • d) if the option is exercised, there is only volatility value available to the trader
  • CLICK FOR ANSWER

Question 4:

if an option is a call option, then it may increase in value if

  • a) the market price for the spot goes down
  • b) the market price for the spot goes up
  • c) the market price for the spot stays the same
  • d) the market price for the spot goes away
  • CLICK FOR ANSWER
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Level Review

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