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All main topics / Finance & Investment / Derivatives / Derivatives
8.What is a description of the trading strategy where an investor sells a 3-month call option and buys a one-year call option, where both options have a strike price of $100 and the underlying stock price is $75?
A.Neutral Calendar Spread
B.Bullish Calendar Spread
C.Bearish Calendar Spread
D.None of the above
Answer: B

This is a bullish calendar spread because a big increase in the stock price between three months and one year is necessary for the trading strategy to be profitable.

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




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