n NISM Certifications
NSM General NISM
Medium

A trader expects the 3-month interest rate to fall in one month. What should he do today?

Practice question from NISM Series IV - Mock Test 4 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Buy contract expiring in 3 months on underlying sensitive to 1-month rate

  2. Buy contract expiring in 1 month on underlying sensitive to 3-month rate

    Correct answer

  3. C

    Sell contract expiring in 1 month on underlying sensitive to 3-month rate

  4. D

    None of the above

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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