SIE practice questionmediumOptions - Puts
If an investor buys a put option, what right do they acquire?
- ASell the underlying stock at the strike price✓ Correct answer
- BBuy the underlying stock at the strike price
- CReceive regular interest payments
- DSell the option to the issuer
Explanation
Why A — Sell the underlying stock at the strike price
Buying a put gives the right to sell at the strike price. Calls are for buying; options do not provide interest; options are traded in the secondary market.
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