Chapter 07 · Section 7.1

Long Straddle Question 4

An increase in volatility will:

a) decrease the value of your straddle and increase your return.
• b) have no effect on the value of your straddle.
  No.
  c) increase the value of your straddle and increase your return.
  d) increase the value of your straddle and decrease your return.
  e) decrease the value of your straddle and decrease your return.