SIE practice questionmediumOptions Strategy
An investor buys a put and a call with the same strike and expiration on the same stock. This strategy is known as:
- AA collar
- BA covered call
- CA spread
- DA straddle✓ Correct answer
Explanation
Why D — A straddle
A straddle combines a call and a put, same strike/expiration. Covered calls and spreads involve different options; collars use a put plus covered call.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Options questions
- An investor owns 100 shares of DEF, currently trading at $60. They write 1 DEF 65 call at $2 and buy 1 DEF 55 put at…
- Which of the following describes a put option?
- A customer sells an uncovered call. What is the risk?
- If a customer buys 1 ABC May 50 call at $3 when ABC is at $54, what is the intrinsic value?