Business, 05.05.2020 19:24 victoria02117

A option is an option to purchase a specified number of shares of a stock on or before some future date at a specified price, whereas a option is an option to sell a specified number of shares of a stock on or before some future date at a specified price. are purchased if the stock price is expected to fall.

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Answer from: anissa760

The answer is

Call;

Put;

Explanation:

Call option is an option that provides the right but not an obligation to buy the underlying asset(e.g stock) at a predetermined price(exercise or strike price) in the future. The buyer of the call option expects the price of the underlying asset to rise.

Put option is an option that provides the right but not an obligation to sell or deliver the underlying asset(e.g stock) at a predetermined price(exercise or strike price) in the future. An investor buying put option is expecting the price of the underlying to fall in value

Answer from: dpchill5232

A call option is an option to purchase a specified number of shares of a stock on or before some future date at a specified price, whereas a put option is an option to sell a specified number of shares of a stock on or before some future date at a specified price. straddle are purchased if the stock price is expected to fall.

Explanation:

Call options may be purchased for speculation, or sold for income purposes. They may also be combined for use in spread or combination strategies.

A call buyer profits when the underlying asset increases in price.

Put options are traded on various underlying assets, including stocks, currencies, bonds, commodities, futures, and indexes.

Straddle strategy is when you simultaneously buy a call option and a put option on the same underlying stock with the same expiration date and strike price.

It is recommended to buy the option when the stock is undervalued or discounted. It is considered a low risk trade for investors because the cost of purchasing the call and put options is the maximum amount of loss the trader will face.

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Answer from: Quest

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