Series 7 - General Securities Representative Exam

Preview Mode

Which of the following trades indicates that an investor is bearish on ABC stock?

Long 40 put short 30 put
A
Short 50 put
B
Long 45 call short 55 call
C
Short 40 put long 30 put
D

Explanations

A is a bear debit (vertical spread). it is bearish. B is bullish, C is bullish, D is neutral to bullish (sold credit vertical spread)

Pricing