bull speculator to bear speculator
bear speculator to bull speculator
lame duck to bull speculator
stag to under writer
Answer is Right!
Answer is Wrong!
The correct answer is: B. bear speculator to bull speculator
Contango
is a situation in the futures market where the futures price is higher than the spot price. This means that speculators who are buying futures contracts are expecting the price of the underlying asset to increase in the future. The contango charge is the amount that the bear speculator pays to the bull speculator in order to take on the risk of the futures contract.The other options are incorrect because:
- A. bull speculator to bear speculator: This is the opposite of the correct answer. The bull speculator is the one who is buying the futures contract, and the bear speculator is the one who is selling the futures contract.
- C. lame duck to bull speculator: A lame duck is a politician who is not seeking re-election. This has nothing to do with the futures market.
- D. stag to under writer: A stag is a person who buys shares in a new company before they are offered to the public. An underwriter is a person who helps to finance a new company by buying shares in the company. This has nothing to do with the futures market.