Asked by PERLA MENDIOLA on Jul 15, 2024
Verified
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.
Verified Answer
Learning Objectives
- Identify the differences between long and short positions in futures trading and grasp their impacts.
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