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:
a) take a short position.
b) take a long position.
A call gives its holder the right to buy and its writer the obligation to sell a specified quantity of the underlying asset at a specified price. If you expect lower prices, would you rather buy or sell the underlying?