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Basic Question 1 of 7
Market participants that take advantage of misalignments between the prices of futures contracts and the prices of their underlying commodities to earn the riskless profit are called ______.
B. hedgers
C. arbitrageurs
D. traders
A. speculators
B. hedgers
C. arbitrageurs
D. traders
User Contributed Comments 4
| User | Comment |
|---|---|
| rfvo | Why C? |
| Vikku | Only arbitrageurs make riskless profits. |
| ascruggs92 | The answer is C because that is the definition of arbitrage. |
| Inaganti6 | riskless profit = key word |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
explain how the concepts of arbitrage and replication are used in pricing derivatives
CFA® 2025 Level I Curriculum, Volume 5, Module 4.