Question

If you think that the dollar is going to depreciate against the euro, you should:

a.buy put options on the euro.
b.sell call options on the euro.
c.buy call options on the euro.
d.none of the options

Answer 1

c.buy call options on the euro.

Step-by-step explanation:

• Buying call options is a trading strategy of securing financial contracts that give the buyers the privilege to buy a bond, stock, or other assets at a specified price, called strike price, for a certain period of time.

• People, especially traders, buy call options when they expect the price of a commodity or asset to rise higher in the near future. It helps them to buy large amounts of commodities or assets at a specified price even when the price value of such commodities or assets increases in the future.