Options Strategies
An investor owns 100 shares of stock and buys a put option on those shares. This strategy is called a:
A protective put (also called a married put) involves owning stock and buying a put option on that stock. The put provides downside protection by giving the investor the right to sell shares at the strike price, regardle
Complete Analysis & Legal Rationale
A protective put (also called a married put) involves owning stock and buying a put option on that stock. The put provides downside protection by giving the investor the right to sell shares at the strike price, regardless of how far the stock falls.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Matches the verified teaching point in the explanation.
Does not match the governing securities rule described in the explanation.
Official Standard: Governs options accounts, approvals, and related supervisory requirements (verify current text).
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.