The payoffs from investing in options are designed so that:
A)Both buyers and sellers can profit
B)The seller's (buyer's) gain is the buyer's (seller's) loss
C)Roughly 20% of sellers and 50% of buyers profit
D)Few buyers or sellers profit; they buy "insurance"

Question

Quizplus · Accepted Answer

The payoffs from investing in options are designed such that the gain of the seller is the loss of the buyer and vice versa. Therefore, both parties cannot profit simultaneously, and it is a zero-sum game.

The Payoffs from Investing in Options Are Designed So That