Chapter 9: Options Basic Test:

Question 1

Holder Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
Breakeven: Strike + Premium

What options position is this?

Answer 1

Long Call

Question 2

Action: Obligation to Sell
Max Gain: Premium Paid
Max Loss: Unlimited
Breakeven: Strike + Premium

What options position is this?

Answer 2

Short Call

Question 3

Action: Right to Sell
Max Gain: Strike - Premium
Max Loss: Premium Paid
Breakeven: Strike - Premium

What options position is this?

Answer 3

Long Put

Question 4

Action: Obligation to Buy
Max Gain: Premium Received
Max Loss: Strike - Premium
Breakeven: Strike - Premium

What options position is this?

Answer 4

Short Put

Question 5

LONG 1 AAPL May 180 Call @ 4.20

What is this options positions status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 5

Long Call

Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
• 4.20 × 100 = $420
Breakeven: Strike + Premium
• 180 + 4.20 = 184.20

Question 6

SHORT 1 TSLA Jun 200 Call @ 6.10

What is this options positions status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 6

Short Call

Action: Obligation to Sell
Max Gain: Premium Received
6.10 × 100 = $610
Max Loss: Unlimited
Breakeven: Strike + Premium
200 + 6.10 = 206.10

Question 7

LONG 1 AMZN Apr 150 Put @ 3.75

What is this options positions status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 7

Long Put

Action: Right to Sell
Max Gain: Strike - Premium
150 − 3.75 = 146.25 (×100 = $14,625)
Max Loss: Premium Paid
3.75 × 100 = $375
Breakeven: Strike - Premium
150 − 3.75 = 146.25

Question 8

SHORT 1 NVDA May 500 Put @ 8.40

What is this options positions status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 8

Short Put

Action: Obligation to Buy
Max Gain: Premium Received
8.40 × 100 = $840
Max Loss: Strike - Premium
500 − 8.40 = 491.60 (×100 = $49,160)
Breakeven: Strike - Premium
500 − 8.40 = 491.60

Question 9

LONG 1 AAPL May 180 Call @ 4.20

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 9

Answer:
Long Call

Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
4.20 × 100 = $420
Breakeven: Strike + Premium
180 + 4.20 = 184.20

Question 10

LONG 1 MSFT Jun 310 Call @ 7.50

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 10

Answer:
Long Call

Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
7.50 × 100 = $750
Breakeven: Strike + Premium
310 + 7.50 = 317.50

Question 11

LONG 1 META Apr 400 Call @ 12.10

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 11

Answer:
Long Call

Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
12.10 × 100 = $1,210
Breakeven: Strike + Premium
400 + 12.10 = 412.10

Question 12

LONG 1 NFLX Jul 600 Call @ 18.40

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 12

Answer:
Long Call

Action: Right to Buy
Max Gain: Unlimited
Max Loss: Premium Paid
18.40 × 100 = $1,840
Breakeven: Strike + Premium
600 + 18.40 = 618.40

Question 13

SHORT 1 TSLA Jun 200 Call @ 6.10

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 13

Answer:
Short Call

Action: Obligation to Sell
Max Gain: Premium Received
6.10 × 100 = $610
Max Loss: Unlimited
Breakeven: Strike + Premium
200 + 6.10 = 206.10

Question 14

SHORT 1 NVDA Apr 900 Call @ 22.50

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 14

Answer:
Short Call

Action: Obligation to Sell
Max Gain: Premium Received
22.50 × 100 = $2,250
Max Loss: Unlimited
Breakeven: Strike + Premium
900 + 22.50 = 922.50

Question 15

SHORT 1 AMZN May 170 Call @ 5.80

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 15

Answer:
Short Call

Action: Obligation to Sell
Max Gain: Premium Received
5.80 × 100 = $580
Max Loss: Unlimited
Breakeven: Strike + Premium
170 + 5.80 = 175.80

Question 16

SHORT 1 AAPL Jul 210 Call @ 4.95

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 16

Answer:
Short Call

Action: Obligation to Sell
Max Gain: Premium Received
4.95 × 100 = $495
Max Loss: Unlimited
Breakeven: Strike + Premium
210 + 4.95 = 214.95

Question 17

LONG 1 AMZN Apr 150 Put @ 3.75

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 17

Answer:
Long Put

Action: Right to Sell
Max Gain: Strike − Premium
150 − 3.75 = 146.25 (×100 = $14,625)
Max Loss: Premium Paid
3.75 × 100 = $375
Breakeven: Strike − Premium
150 − 3.75 = 146.25

Question 18

LONG 1 TSLA Jun 180 Put @ 9.60

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 18

Answer:
Long Put

Action: Right to Sell
Max Gain: Strike − Premium
180 − 9.60 = 170.40 (×100 = $17,040)
Max Loss: Premium Paid
9.60 × 100 = $960
Breakeven: Strike − Premium
180 − 9.60 = 170.40

Question 19

LONG 1 MSFT May 300 Put @ 6.20

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 19

Answer:
Long Put

Action: Right to Sell
Max Gain: Strike − Premium
300 − 6.20 = 293.80 (×100 = $29,380)
Max Loss: Premium Paid
6.20 × 100 = $620
Breakeven: Strike − Premium
300 − 6.20 = 293.80

Question 20

LONG 1 NVDA Jul 550 Put @ 21.10

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 20

Answer:
Long Put

Action: Right to Sell
Max Gain: Strike − Premium
550 − 21.10 = 528.90 (×100 = $52,890)
Max Loss: Premium Paid
21.10 × 100 = $2,110
Breakeven: Strike − Premium
550 − 21.10 = 528.90

Question 21

SHORT 1 NVDA May 500 Put @ 8.40

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 21

Answer:
Short Put

Action: Obligation to Buy
Max Gain: Premium Received
8.40 × 100 = $840
Max Loss: Strike − Premium
500 − 8.40 = 491.60 (×100 = $49,160)
Breakeven: Strike − Premium
500 − 8.40 = 491.60

Question 22

SHORT 1 AAPL Jun 160 Put @ 5.20

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 22

Answer:
Short Put

Action: Obligation to Buy
Max Gain: Premium Received
5.20 × 100 = $520
Max Loss: Strike − Premium
160 − 5.20 = 154.80 (×100 = $15,480)
Breakeven: Strike − Premium
160 − 5.20 = 154.80

Question 23

SHORT 1 TSLA Apr 190 Put @ 7.90

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 23

Answer:
Short Put

Action: Obligation to Buy
Max Gain: Premium Received
7.90 × 100 = $790
Max Loss: Strike − Premium
190 − 7.90 = 182.10 (×100 = $18,210)
Breakeven: Strike − Premium
190 − 7.90 = 182.10

Question 24

SHORT 1 AMZN Jul 140 Put @ 4.65

What is this options position’s status?

Action:
Max Gain:
Max Loss:
Breakeven:

Answer 24

Answer:
Short Put

Action: Obligation to Buy
Max Gain: Premium Received
4.65 × 100 = $465
Max Loss: Strike − Premium
140 − 4.65 = 135.35 (×100 = $13,535)
Breakeven: Strike − Premium
140 − 4.65 = 135.35

Question 25

A long option means: • I GET to buy (if it’s a call) • I GET to sell (if it’s a put)

Question 26

________ Option: This is a contract that gives the holder the right to _____ the underlying security at the strike price, and gives the writer the obligation to SELL if exercised.

Answer 26

Call Option BUY

Question 27

________ Option: This is a contract that gives the holder the right to ________ the underlying security at the strike price, and gives the writer the obligation to BUY if exercised.

Answer 27

Put Option SELL

Question 28

Call Option is a contract that gives the holder the right to BUY the underlying security at the strike price, and gives the writer the obligation to _______ if exercised.

Answer 28

SELL

Question 29

Put Option is a contract that gives the holder the right to SELL the underlying security at the strike price, and gives the writer the obligation to _______ if exercised.

Answer 29

BUY

Question 30

Options Memory Trick: _____ me UP to BUY! 📲

Answer 30

Call

Question 31

Options Memory Trick: _____ it DOWN to SELL! 📲

Answer 31

Put