n NISM Certifications
XXI NISM Series XXI-A
Medium

A 'call option' gives the holder the right to:

Practice question from NISM XXI A for PMS - Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Sell the underlying asset at a specified price

  2. Buy the underlying asset at a specified price

    Correct answer

  3. C

    Sell the underlying asset at the market price

  4. D

    Buy the underlying asset at the market price

Why this is the answer

A call option grants the right to buy the underlying security at the strike price before expiry.

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