n NISM Certifications
NSM General NISM
Medium

An Indian exporter hedges currency volatility risk by paying a fee to a bank. What economic function is performed?

Practice question from NISM Series I - Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Risk transfer

    Correct answer

  2. B

    Price discovery in futures market

  3. C

    More trading volume in spot market

  4. D

    Shifting volatility from spot to futures

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

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