Exercise：
　　A butterfly spread involves positions in options with three difference strike prices. It can be created by buying a call option with a low strike of ; buying a call option with a high strike ; and selling two call options with a strike  halfway between and .What can be said about the upside and downside of the strategy?
　　A.Both the upside and downside is unlimited
　　B.Both the upside and downside is limited
　　C.The upside is unlimited but the downside is limited
　　D.The upside is limited but the downside is unlimited
　　Answer: B
　　The pay-off structure to this strategy leaves the upside and downside potential at the difference between the premium collected on the calls sold and the premium paid on the calls purchased.
　　相關(guān)知識點(diǎn)：Option Spread Strategies
　　Option Spread Strategies
　　Bull spread: Purchase call option with low exercise price and subsidize the purchase with sale of a call option with a higher exercise price.
　　Bear spread: Short bull spread. Purchases call with high strike price, and shorts call with low strike price. Investor keeps difference in price of the options if stock price falls. Bear spread with puts involves buying put with high exercise price and selling put with low exercise price.
　　Butterfly spread: Three different options: buy one call with low exercise price, buy another with a high exercise price, and short two calls with an exercise price in between. Butterfly buyer is betting the stock price will stay near the price of the written calls.
　　Calendar spread: Two options with different expirations. Sell a short-dated option and buy a long-dated option. Investor profits if stock price stays m a narrow range.
　　Diagonal spread: Similar to a calendar spread except that the options can have different strike prices in addition to different expirations.
　　Box spread: Bull call spread and a bear put spread on the same asset. The payoff is always the same (the risk-free rate).
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