Asked by PERLA MENDIOLA on Jul 15, 2024

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A trader who has a __________ position in wheat futures believes the price of wheat will __________ in the future.

A) long; increase
B) long; decrease
C) short; increase
D) long; stay the same
E) short; stay the same

Wheat Futures

Contracts that specify the future delivery of a certain amount of wheat at a predetermined price.

Price Increase

An upward movement in the price of a good, service, or asset, often due to factors like demand growth or supply constraints.

Long Position

Holding an asset with the expectation that it will increase in value, often contrasted with taking a short position, betting on a decline in value.

  • Identify the differences between long and short positions in futures trading and grasp their impacts.
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RD
Racheal D'SouzaJul 17, 2024
Final Answer :
A
Explanation :
A long position in futures means the trader is buying with the expectation that the asset's price will increase.