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All main topics / Finance & Investment / Derivatives / Derivatives
10.Which of the following must post margin?
A.The seller of an option
B.The buyer of an option
C.The seller and the buyer of an option
D.Neither the seller nor the buyer of an option

Answer: A

The seller of the option must post margin as a guarantee that the payoff on the option (if there is one) will be made. The buyer of the option usually pays for the option upfront and so no margin is required.

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Flashcard info:
Author: CoboCards-User
Main topic: Finance & Investment
Topic: Derivatives
Published: 27.10.2015




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