A buyer of the call option is speculating on the
A) Direction of the price movement of the underlying investment.
B) Timing of the price movement of the underlying investment.
C) Leverage that a call option creates with respect to the underlying investment.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

A buyer of a call option is speculating on the direction of the price movement (expecting it to rise), the timing (before expiration), and the leverage (amplified gains with limited risk) that the option provides.

A Buyer of the Call Option Is Speculating on the