n NISM Certifications
XIII NISM Series XIII
Medium

What is the effect of a 'Hedging' strategy in financial markets?

Practice question from NISM Series XIII for SIF - Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Eliminates all risks

  2. Reduces or offsets potential losses from adverse price movements

    Correct answer

  3. C

    Guarantees profit

  4. D

    Increases market volatility

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

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