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Options Basics Quiz

1. A CALL option gives you the investors the right to...?

A.Buy a stock at the highest traded price
B.Buy a stock at a predetermined price
c.Sell a stock at the highest traded price
d.Sell a stock at a predetermined price

2. You bought a PUT Option. The Stock's price must pass what point to be 'In-The-Money'?

A.Above the PUT Price
B.Above the Strike Price
c.Maturity Date
d.Below the Strike Price

3. You are bearish on a particular Stock, you would buy a...?

A.Call Option
B.Put Option
c.Zero Coupon Option
d.All of the Above

4. You bought a CALL Option with a Strike Price of $75.00. On expiration day the underlying Stock price is $78.50, your Option is...

A.said to be Out-of-The-Money
B.said to be At-The-Money
c.said to be In-of-The-Money
d.None of the Above

5. The acronym LEAPS stands for what?

A.Long Term Early Assignment Position Settlement
B.Long Term Equity AnticiPation Securities
c.Lengthy Equity AnticiPation Securities
d.Long Term Equity Auto Positioning Securities

6. You have 5,000 shares of a Stock. You are convinced after extensive research that the Stock is in an overall uptrend but wish to make some income on your position. You would consider...

A.Buying CALL Options
B.Selling PUT Options
c.Selling Covered CALL Options
d.Buying PUT Options