The CPPI payoff diagram most resembles which of the following option strategies: A) Covered call B) Short straddle C) Protective put D) Long straddle
A
C - as it provides downside protection due to it’s convexity
skillionaire - how’s your golf game coming along?
Down to a .2 index, but decided two days ago to put the clubs away until exam day (but that never lasts). Pleased with how I’ve been hitting the ball, though - thanks for asking.
C
C
Yuppers, it’s “C” - you guys and gals are too good. More Schweser Book 5 quizzes on the way as I come across worthwhile topics.
nice…i think i confused the question…thought of a convex line for CPPI, but the payoff looks most like protective put, flat then slightly sloping upwards. is that right? Nice…I doubt you’ll put them clubs away. 
I think the CPPI is buyinf or selling insurance in this capacity too. Can’t remember now.
joker Wrote: ------------------------------------------------------- > I think the CPPI is buyinf or selling insurance in > this capacity too. Can’t remember now. The CPPI is akin to buying insurance. Mp2438, the CPPI does have a convex shape, which is also what a protective put has. Flat then increasing in slope is what the graph looks like. And if I pull a few more of these twelve hour study days, I might be on the golf course sooner rather than later.
And if I pull a few more of these twelve hour study days, I might be on the golf course sooner rather than later. Don’t you work man?
cfaboston28 Wrote: ------------------------------------------------------- > And if I pull a few more of these twelve hour > study days, I might be on the golf course sooner > rather than later. > > Don’t you work man? Hell no…as my man from Goodfellas said, “the working man is a sucker”. Got my required experience for my charter already; no need to slave for the man any longer.
what do you do for living then?
cfaboston28 Wrote: ------------------------------------------------------- > what do you do for living then? I’m very blessed.