- CFA Exams
- CFA Level I Exam
- Topic 7. Derivatives
- Learning Module 2. Forward Commitment and Contingent Claim Features and Instruments
- Subject 2. Contingent Claims: Options
CFA Practice Question
A contract giving the owner the right to sell a specific stock at a specific price by a certain date is a ______.
B. call option
C. future contract
D. stock index future contract
A. put option
B. call option
C. future contract
D. stock index future contract
Correct Answer: A
User Contributed Comments 5
| User | Comment |
|---|---|
| rana1970 | not right but obligation |
| jpducros | Remember: Call = Buy ; Put = Sell |
| poomie83 | future is a commitment to sell not a right |
| johntan1979 | I almost got thrown off by "by a certain date". You can exercise the option at any time, but not after the expiration date. |
| GBolt93 | Rana it's an obligation only if you exercise the option, which you have the right to do or not do. |