n NISM Certifications
XIII NISM Series XIII
Medium

Identify which of these is NOT an example of hedge.

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

Options

  1. A

    A) A fund manager is expecting market volatility after RBI policy, buys index put options to limit the loss on his portfolio

  2. B

    B) An exporter is expecting to receive dollars after 1 month, takes a short position in one-month USDINR futures to lock in his dollar price

  3. C) Mr. Patil, a stock trader is bullish on the market and therefore buys an out-of-the-money index call and sells an out-of-the-money index put option

    Correct answer

  4. D

    D) A trader with a short index futures position buys an out-of-the-money call on the index so as to limit his loss

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

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