This week’s study question from the Solomon Online Exam Simulator question database is now available. Be sure to submit your answers in the comments section and check back tomorrow for the correct answer and rationale!
Sam bought 1,000 shares of XYZ Corporation three months ago and the stock has appreciated significantly over that time. Sam decides to go short against the box. What does this mean?
A: Sam has decided to short 1,000 shares of XYZ.
B: Sam has decided to write 10 call options of XYZ stock.
C: Sam has decided to write 10 put options of XYZ stock.
D: Sam has decided to sell his shares of XYZ and then buy the shares back after a 30-day window.