n NISM Certifications
VIII NISM Series VIII
Medium

A stock is trading at Rs 100. Mr. Ashwin buys a Straddle at a strike price of 100 and pays a premium of Rs.10 for the Call option and Rs.5 for the Put option. Based on this information, identify the correct statement.

Practice question from NISM Series VIII - Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    The break-even point for the Call Option is Rs 110

  2. B

    The break-even point for the Put Option is Rs 95

  3. C

    This straddle has two break-even points

  4. All of the above

    Correct answer

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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