Question
1.Strengthening basis improves ______'s position, and weakening basis improves _______'s position. a.Short hedger; Long hedger b.Long hedger; Short hedger c.Short hedger; Short hedger d.Long hedger;
1.Strengthening basis improves ______'s position, and weakening basis improves _______'s position.
a.Short hedger; Long hedger
b.Long hedger; Short hedger
c.Short hedger; Short hedger
d.Long hedger; Long hedger
e.Neutral hedger; Short hedger
2.All else equal, when the cost of carry is ________ than the convenience yield, the forward/futures prices __________ with contract maturity.
a.greater; do not change
b.greater; increase
c.smaller; increase
d.greater; decrease
e.smaller; do not change
3._____ hedgers incur losses on futures position when the futures price is ______ over time; and ______ hedgers incur losses on futures position when the futures price is _______ over time.
a.long; falling; short; falling
b.long; increasing; short; increasing
c.short, falling; long; increasing;
d.long; falling; short; increasing
e.long; steady; short; steady
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