Study the options-on-futures portion of Series 3: terminology, premium economics, hedging, speculation, and spread strategy logic.
Series 3 includes options on futures because they offer another way to hedge or speculate while changing the risk profile. The candidate must understand long and short options, premium behavior, limited-risk versus potentially unlimited-risk positions, and how options can substitute for or protect futures positions.
Read this chapter as the options-logic layer of the exam. The first lesson covers options vocabulary and basic position economics. The second covers common hedging, speculative, and spread strategies.
Learn how Series 3 tests option terms, premium behavior, limited-risk versus unlimited-risk positions, and the economic meaning of long and short options.