Economics · Financial Derivatives
Find out the correct statements from the following: A. A futures contract is custom designed. B. Buying a put option is equivalent to buying insurance. C. The cost of carry is not the cost of holding a security. D. The difference between the spot price and the futures price is called the basis. E. An American option can be exercised only at its expiration date. Choose the most appropriate answer from the options given below:
- 1A and C Only
- 2B and E Only
- 3B and D Only✓
- 4A and E Only
Correct answer
B and D Only
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