Options
- A
Cash prices and future prices
- B
Different tenors of interest rates
-
Both 1 and 2
Correct answer
- D
None of the above
Why this is the answer
Basis risk arises due to mismatches in contract sizes or maturity dates, causing imperfect hedges between futures and cash instruments or across tenors.
Test yourself for real
Take a full General NISM mock test.
Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.