Chapter 02 · Section 2.1

Price Fall- Call

FUTURES & FORWARDS CALL OPTIONS PUT OPTIONS

If you expect a fall in price SHORT ...... ...... (Bearish)

If you expect a rise in price LONG ...... ...... (Bullish)

With a call option, if you expect the price of the underlying asset to fall, you:

b) take a long position.
No. If you are long a call and the price falls, you would not want to exercise the option because you could buy on the spot market at a price less than the exercise price. The market is going against your position.