You hold a straddle on a stock that you bought a month ago and that still has two months to expiry. Assume the options are European. An unexpected increase of $1 in the price of the stock
A) Changes the value of your straddle by more than $1.
B) Changes the value of your straddle by at most $1.
C) Leaves the value of your straddle unchanged.
D) Any of the above can happen.
Correct Answer:
Verified
Q12: Which of the following statements is valid
Q13: Which of the following statements is false?
A)
Q14: The gamma of an option is
A) The
Q15: The current stock price is $50,
Q16: You hold a straddle on a stock
Q18: The current stock price is $50, and
Q19: A stock is currently trading at
Q20: A stock is trading at $80.
Q21: Which of the following statements is true?
Q22: For options that are at-the-money, which of
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