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Risk Management Applications of Option Strategies (Reading 65, CFA, Level I)

This quiz is about Reading 65, CFA, Level I, Risk Management Applications of Option Strategies

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  1. Question 1 of 4
    1. Question

    An investor purchases a put option on a stock with a strike price of $95. The premium paid is $5 and the stock price is $100. Calculate the maximum gain for the investor:

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  2. Question 2 of 4
    2. Question

    The call option holder will exercise the option when the stock price is:

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  3. Question 3 of 4
    3. Question

    A trader has written a covered call. The profit pattern from this written covered call will be most similar to:

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  4. Question 4 of 4
    4. Question

    A trader forms a protective put strategy using a stock worth $25 and a put option on the stock with a strike price of $20 and an option premium of $2. Calculate the maximum possible net profit and net loss from this strategy.

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