Test your knowledge gained from the DeFi Options Basics course!

Exam: DeFi Options Basics

When the investor wants to hedge downside risk.

When the investor anticipates prices to rise.

When the investor anticipates prices to fall.

When should an investor enter a long call position?

The only use case for options is directional trading

What are some of the most common use cases for DeFi options?

When hedging risk by buying put options, what's the maximum loss that can occur for an investor?

Depositing collateral on a lending platform.

Depositing to strategy vaults and/or options liquidity pools.

How can investors earn yield from DeFi options without directly trading them?

If the underlying asset falls in value the underwriter may have to buy the asset at the higher strike price, resulting in theoretically infinite downside.

The underlying asset expiring above the strike price.

What's the biggest risk involved with short puts?

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2.5 Exam: DeFi Options Basics

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