Task: Class Definition Understanding (ontology: Business_Finance/Financial_Industry_Business_Ontology)

Which of the following definitions best describes 'protective collar'?

A. collar that consists of a covered call and protective put
B. price at which a lot of the underlying asset may be bought or sold when the contract is exercised
C. butterfly strategy that consists of two call options and two put options, three strike prices and the same expiration date
D. option trading strategy in which the investor holds a position in both a call and a put option with different strike prices, but with the same expiration date and underlying asset

Answer: collar that consists of a covered call and protective put