Series 6 - Investment Company And Variable Contracts Products Representative Exam
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When an investor buys a put option, the buyer of the put has the ________ to sell the underlying security, but does not have the ____________ to sell the underlying security.
Obligation / Right
A
Right / Obligation
B
Obligation / Option
C
Option / Obligation
D
Explanations
The buyer of the put option is purchasing the right, but not the obligation to sell the underlying security at a specified price (strike price) on or before the put option's expiration.