Question: The spread you use if you expected a very large price move of the underlying, but were unsure of the direction is a: Bull call

  1. The spread you use if you expected a very large price move of the underlying, but were unsure of the direction is a:
    1. Bull call spread
    2. Butterfly
    3. Calendar Spread
    4. Iron Condor
    5. Straddle
  2. The spread you use if you expected the underlying to move in a relatively tight range is a:
    1. Bull call spread
    2. Butterfly
    3. Straddle
    4. Calendar Spread
    5. Iron Condor
  3. This spread exploits the differential in theta between two options:
    1. Iron straddle
    2. Short butterfly
    3. Calendar spread
    4. Iron Condor
    5. Call diagonal spread
  4. This spread creates an immediate but set profit with exposure equal to the amount of spread minus premium:
    1. Iron straddle
    2. Short butterfly
    3. Calendar spread
    4. Iron Condor
    5. Call diagonal spread

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!