What best describes the primary purpose of derivatives in financial markets?(2 Points)HedgingSpeculationArbitrageInvestment
Question
Solution 1
The primary purpose of derivatives in financial markets can be described as all of the above - Hedging, Speculation, Arbitrage, and Investment. However, the best description would depend on the context.
- Hedging: Derivatives are often used to hedge against potential losses. For example, a compan Knowee AI is a powerful AI-powered study tool designed to help you to solve study problem.
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