The Primary Use of Stock Index Futures by the Portfolio

question 41

Multiple Choice

The primary use of stock index futures by the portfolio manager is:

• A)to offset the loss on the portfolio in a declining market.
• B)to profit from major market movements.
• C)to increase the profit potential on the portfolio.
• D)All of the above

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Definitions:

Concrete Operational Stage

A phase of cognitive development in children, proposed by Piaget, where they are able to think logically about objects and events.

Cognitive Development

the study of how thinking, problem solving, and intelligence evolve and change throughout the lifespan.

Age 7-11

Refers to the middle childhood period, characterized by the development of logical thinking, self-awareness, and increased independence.

Formal Operational Stage

The fourth and final stage of Jean Piaget's theory of cognitive development, where individuals develop the ability to think abstractly, logically, and systematically.