This does not necessarily mean that options are less risky than spot or futures positions. Options can,
Question:
This does not necessarily mean that options are less risky than spot or futures positions.
Options can, in fact, be riskier than other investments since they exist for only a limited period of time and are leveraged investments (i.e., their value is only a fraction of the underlying security). To compare an option position to a spot position one must consider an equal dollar investment in the two positions over a common period of time.
LO.1
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Financial Markets And Institutions
ISBN: 9781259919718
7th Edition
Authors: Anthony Saunders, Marcia Cornett
Question Posted: