Financial Risk Manager Part 1

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Answer: Short put option

A covered call is a **long stock + short call** position. Its payoff is essentially the same as a **short put option**. Both positions have limited upside and downside exposure that resembles taking on the obligations of a short put.

Author: Manit Arora

Quick Answer

Answer-first summary for fast verification

Answer: Short put option

A covered call is a **long stock + short call** position. Its payoff is essentially the same as a **short put option**. Both positions have limited upside and downside exposure that resembles taking on the obligations of a short put.

Author: Manit Arora

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Q-137.2 The payoff pattern writing a covered call is most similar to the payoff pattern of:

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MManit

Last updated: April 18, 2026 at 11:32

0

A

Long put option

B

Short put option

C

Long forward position

D

Short forward position

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