An option which gives the holder the right to sell a stock at a specified…
2019
An option which gives the holder the right to sell a stock at a specified price at some time in the future is called a:
- A.
Naked option
- B.
Call option
- C.
Put option
- D.
Out of money option
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Correct answer: C
A Put Option gives the holder the right to sell a stock or asset at a predetermined price (strike price) before or on a specified date. It is typically used by investors who expect the price of the stock to fall in the future.