A put option gives the owner ________.
A) the right to sell the underlying security
B) the obligation to sell the underlying security
C) the right to buy the underlying security
D) the obligation to buy the underlying security

Question

Quizplus · Accepted Answer

A put option gives the owner the right (but not the obligation) to sell the underlying security at a specified price (strike price) within a certain time frame. Therefore, choice A is correct. Choice B is incorrect because options do not impose obligations on the owner. Choices C and D are incorrect because they describe call options, not put options.

A Put Option Gives the Owner ________