7. You expect a bearish market in the near future. Which action benefits from do

Question

7. You expect a bearish market in the near future. Which action benefits from downside price movement and has some protection against bullish market? A. Short a call and buy a put with the same exercise price. B. Buy a call and buy a put with the same exercise price. C. Buy a call with low exercise price and short a call with high exercise price. D. Short a call with low exercise price and buy a call with high exercise price. 7. You expect a bearish market in the near future. Which action benefits from downside price movement and has some protection against bullish market? A. Short a call and buy a put with the same exercise price. B. Buy a call and buy a put with the same exercise price. C. Buy a call with low exercise price and short a call with high exercise price. D. Short a call with low exercise price and buy a call with high exercise price.

Explanation / Answer

Short a call and buy a put with the same exercise price.

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