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

The buyer of a call option is speculating on the direction and timing of the price movement of the underlying investment, as well as taking advantage of the leverage that a call option provides. Therefore, all of the above are correct.

A Buyer of the Call Option Is Speculating on the