Series 7 - General Securities Representative Exam
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It is June. An investor expects little to no movement in BCD corp stock over the next month. What would you suggest to the investor?
Sell the July ATM Straddle
A
Buy the July ATM Straddle
B
Buy 100 shares and sell an OTM Call
C
Short 100 Shares and sell an OTM put
D
Explanations
Selling the straddle is selling a call and put in the same expiration at the same strike in anticipation of sideways price action