Series 7 - General Securities Representative Exam

Preview Mode

Richard Fox likes to write options on stocks with high implied volatility. Which of the following strategies is Richard LEAST likely to employ?

Selling Straddles
A
Selling Strangles
B
Buying Call Spreads
C
Buying Strangles to Cover
D

Explanations

Richard is a writer or seller of options. He is least likely to buy a call debit spread. He certainly will buy the strangles back to cover his position if he doesn't let them expire worthless

Pricing