TRADERS CLUB POP QUIZ

A Call Option buyer expects the price of the stock to go up

At the money Options and Out of the Money options have Intrinsic value

A Call option seller has unlimited profits and limited losses

In The Money Options have the highest probability of success

Time decay favors the buyer of Options and hurts the seller of Options

In the Money Options have the maximum Extrinsic value or Time value

Implied Volatility is the only unknown variable in the Options pricing model

You should buy an Option when the Implied volatility is very high to capture large movements

Theta represents the amount of time decay an Option will undergo every month

Theta represents the amount of time decay an Option will undergo every day

Your DELTA IS .33 FOR EVERY 1.00 THE STOCK MOVES HOW MUCH MONEY SHOULD YOUR OPTION INCREASE IN VALUE

A DELTA OF -.50 HOW MUCH WILL YOUR PUT OPTION INCREASE IN VALUE FOR EVERY $1.00 MOVE THE STOCK GOES DOWN.

HOW MANY SHARES DOES 1 OPTIONS CONTRACT REPRESENT

DO WE PURCHASE OPTIONS THAT HAS LITTLE TO NO VOLUME OR OPEN INTEREST?

CALL SELLERS HAVE A RIGHT TO BUY A STOCK AT A CERTAIN PRICE, BY A CERTAIN TIME?

CALL BUYERS HAVE A RIGHT TO BUY A STOCK AT AT CERTAIN PRICE, BY A CERTAIN TIME?