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sunkiss22 sunkiss22
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2 years ago
Which one of the following statements is correct if a speculator short sells a commodity or financial futures contract?

▸ The speculator expects to profit from a decline in the price of the contract.

▸ The speculator stands to make an unlimited amount of profit since there is no limit to how high the price of the underlying commodity or financial instrument can rise.

▸ The speculator is hoping to gain some of the benefit derived from the volatile price while limiting his/her exposure to loss.

▸ The speculator may be hedging if the underlying commodity is not in the speculator's possession.
Textbook 
Fundamentals of Investing

Fundamentals of Investing


Edition: 14th
Authors:
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dongdong
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2 years ago
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sunkiss22 Author
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2 years ago
Helped a lot
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Thanks
jmendoza
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2 hours ago
Correct Slight Smile TY
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