Options
-
It involves taking an opposite position in a related security to reduce risk
Correct answer
- B
It guarantees profit in all market conditions
- C
It increases the overall risk of the portfolio
- D
It is only used by speculative traders
Why this is the answer
Hedging is a risk mitigation strategy.
Test yourself for real
Take a full NISM Series XXI-A mock test.
Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.