Reading 71: Option Markets and Contracts-LOS d 习题精选 2011, following, between, border

1215

Session 17: Derivatives
Reading 71: Option Markets and Contracts

LOS d: Differentiate between exchange-traded options and over-the-counter options.

 

 

Exchange-traded stock options are all of the following EXCEPT:

A) backed by the options clearinghouse.

B) subject to counterparty risk.

C) typically for 100 shares of stock.

---

 

Exchange-traded options are backed by the clearinghouse and not subject to counterparty risk; over-the-counter options are subject to counterparty risk.

luqian55

thanks a lot

1215

Exchange-traded options are NOT:

A) issued by dealers.

B) backed by the Options Clearing Corporation.

C) standardized as to expirations and contract size.

---

Over-the-counter options are issued by dealers.

1215

Over-the-counter options are:

A) very liquid.

B) the most important type in terms of volume.

C) largely unregulated.

---

Over-the-counter options are largely unregulated, not liquid, and represent much less volume than exchange-traded options.