CFA Practice Question

There are 206 practice questions for this study session.

CFA Practice Question

A LONG position in an American call option ______.

A. gives the investor only the rights that a LONG position in an identical European call option would give him
B. gives the investor an extra right that a LONG position in an identical European call option would not give him
C. can only be exercised on the option's expiration date
Correct Answer: B

An American option may be exercised prior to the expiration date. This represents a right not allowed by a European option.

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