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Finra Series-7 Exam - Topic 3 Question 19 Discussion

Actual exam question for Finra's Series-7 exam
Question #: 19
Topic #: 3
[All Series-7 Questions]

In comparing the premium cost of a LEAPS option with a premium of a traditional option on the same security and same strike price, which of the following is generally true?

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Suggested Answer: B

the LEAPS premium will be higher than the traditional option premium. Because LEAPS have a longer time until expiration than traditional options, the premium should be higher.


by Ernie at May 08, 2022, 03:17 PM

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Gerri
4 months ago
I think D is misleading; LEAPS definitely consider time value.
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Abel
4 months ago
Yeah, I've seen LEAPS cost more than traditional options.
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Trevor
4 months ago
Wait, are you sure about that? I thought they were similar.
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Kallie
4 months ago
Totally agree, B is the way to go!
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Lisbeth
5 months ago
LEAPS premiums are usually higher due to longer time frames.
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Tiffiny
5 months ago
I vaguely recall that traditional options might have higher premiums sometimes, but that seems counterintuitive for LEAPS.
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Latonia
5 months ago
I thought the premiums would be similar, but now that I think about it, LEAPS should have more time value, right?
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Sherell
5 months ago
I think I remember that LEAPS options usually have a longer time until expiration, so their premiums might be higher.
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Kathryn
5 months ago
I'm not entirely sure, but I feel like I saw a practice question where LEAPS were definitely more expensive than regular options.
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Marleen
5 months ago
I'm a little confused by the wording here. I'll have to re-read the question a few times to make sure I understand it fully before answering.
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Annalee
5 months ago
Hmm, I'm a bit unsure about this one. I'll need to review the details on triggers, schedulable classes, and batchable classes to decide which option would be best.
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Linsey
5 months ago
Okay, let me see. I remember learning about BootP and how it was an early protocol for diskless workstations to boot from a server. I'm pretty confident that's the right answer here.
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