SIE practice questionmediumOptions
Which options strategy is best suited for generating income in a flat, non-volatile market?
- AWriting naked calls
- BBuying puts
- CBuying straddles
- DCovered call writing✓ Correct answer
Explanation
Why D — Covered call writing
Covered call writing (selling calls against owned stock) generates premium income in a flat market. Buying puts is bearish, buying straddles bets on volatility, and writing naked calls has significant risk.
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