Problem 14. (5 points) A common application of the risk-reversal trade (long an OTM put, short an OTM call) is to hedge an existing long exposure. The investor gives up some of the upside in exchange for downside protection. Which of the following is true? A. The cost of the risk-reversal is highly sensitive to the overall level of volatility, since it is effectively a long volatility play. B. The cost of the risk-reversal is highly sensitive to skew, since the two strike prices are quite far apart. C. The cost of the risk-reversal is not sensitive to skew since the put and the call are both out-of-the-money. D. For an investor already long the stock, the risk-reversal results in a flat position (no exposure to stock movements)