SIE practice questionhardSpreads
A bull put spread profits most if the underlying stock:
- ARemains between both strikes
- BCloses below both strikes at expiration
- CRises sharply, then falls
- DCloses above the higher strike at expiration✓ Correct answer
Explanation
Why D — Closes above the higher strike at expiration
Bull put spreads yield max profit if the stock stays above both strikes, expiring both options. Other answers do not achieve max profit.
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