Asked by Renee Jackson on Jul 27, 2024
Verified
U.S. investors
A) can trade derivative securities based on prices in foreign security markets.
B) cannot trade foreign derivative securities.
C) can trade options and futures on the Nikkei stock index of 225 stocks traded on the Tokyo stock exchange and on FTSE (Financial Times Share Exchange) indexes of U.K. and European stocks.
D) can trade derivative securities based on prices in foreign security markets and can trade options and futures on the Nikkei stock index of 225 stocks traded on the Tokyo stock exchange and on FTSE (Financial Times Share Exchange) indexes of U.K. and European stocks.
E) None of the options are correct.
Derivative Securities
Financial instruments whose value is derived from the value of other, underlying assets.
Nikkei Stock Index
A stock market index for the Tokyo Stock Exchange, representing the performance of 225 top-rated companies listed in Japan.
FTSE Indexes
FTSE Indexes are a series of stock market indices developed by the Financial Times Stock Exchange Group, which include benchmarks for UK and global equities markets.
- Understand how U.S. investors can participate in foreign markets through derivatives and direct investments.
Verified Answer
JE
Jamie EllenJul 31, 2024
Final Answer :
D
Explanation :
U.S. investors can indeed trade derivative securities based on prices in foreign security markets, including options and futures on the Nikkei stock index and FTSE indexes. This allows for a broad range of investment opportunities beyond domestic markets.
Learning Objectives
- Understand how U.S. investors can participate in foreign markets through derivatives and direct investments.