One of your more aggressive option clients has taken a substantial short position in ABC common stock and has simultaneously written puts to cover the short position.  One of the below outcomes represents a worst-case for this client?

An option trade acquires an XYZ  Oct 100 put @ 4 , and some time later goes long 100 shares of XYZ at 92.  The client exercises the put just prior to expiration.  For IRS purposes:

Short put exercise results in:

When the Board of Directors declares and distributes a stock dividend,

An option investor executes an opening sale of a LEAP contract and subsequently closes the position more than one year later.  For tax purposes;

The Series 9 & 10 exams combined provide a Branch Manager of an NYSE member firm with the general sales supervisory responsibilities for each of the following products with the exception of:

One of your RRs has been discussing risk mitigation strategies with a number of his clients who are in the market. Each of the following provide a level of protection against downside risk in long stock positions except:

I. Open buy stop order

II. Open buy limit order

III. Open sell stop order

IV. Open sell limit order

In reference to the previous question on risk mitigation, which of the following will provide a level of protection against downside risk when long stock?

One of your Reps has asked for you to clarify the way in which the IRS wash sale rule is applied, in particular when considering options. They have a client who is planning on doing a year-end sale to generate a capital loss.  Which of the below transactions by that client will not trigger the wash sale rule?

The Options SROs have established position as well as exercise limits. They refer to positions on the ‘same side of the market.’  What position(s) would be considered on the same side of the market as short puts?

I. Short puts

II. Short calls

III. Long puts

IV. Long calls