The taking of a position opposite to that of a current outstanding position is known as a(n) _________ trade.
A) program
B) reverse
C) open
D) optimal
E) market

Question

Quizplus · Accepted Answer

Taking a position opposite to that of a current outstanding position is referred to as a reverse trade. This trade may either be to lock in profits or to limit losses. Option A, program trade, refers to the simultaneous execution of a large number of trades. Option C, open trade, refers to an unfilled or unfinished trade. Option D, optimal trade, is a trade that yields the best outcome based on a particular metric. Option E, market trade, refers to the purchase or sale of stocks at a prevailing market price.

The Taking of a Position Opposite to That of a Current