Which of the following is premised on lower stock prices?
A)buying a stock index call
B)buying a stock index put
C)buying a stock and selling a call
D)buying a stock and selling a put

Question

Quizplus · Accepted Answer

Buying a stock index put option is premised on the expectation of lower stock prices, as it gives the holder the right to sell the index at a predetermined price, potentially benefiting from a decline in the market.

Which of the Following Is Premised on Lower Stock Prices