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If You Are Short a Call and Long an Otherwise

Question 5

Multiple Choice

If you are short a call and long an otherwise identical put on the same stock, where the strike price is the forward price of the stock for the same maturity as the options, you essentially have the following position:


A) A short forward on the stock for the maturity of the option.
B) A synthetic collar.
C) An options position for which you pay a positive net premium up front.
D) An options position for which you receive a net premium up front.

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