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185
5.What is the number of different option series used in creating a butterfly spread?
A.1
B.2
C.3
D.4
A.1
B.2
C.3
D.4
Answer: C
Three different options all with the same maturity are involved in creating a butterfly spread. The strike prices are usually equally spaced. The creator buys the low strike option, buys the high strike option, and sells two of the intermediate strike option
Three different options all with the same maturity are involved in creating a butterfly spread. The strike prices are usually equally spaced. The creator buys the low strike option, buys the high strike option, and sells two of the intermediate strike option
Flashcard info:
Author: CoboCards-User
Main topic: Finance & Investment
Topic: Derivatives
Published: 27.10.2015