The Spot Price of an Asset Is Positively Correlated with the Market

question 2

Multiple Choice

The spot price of an asset is positively correlated with the market. Which of the following would you expect to be true? choose one)

• A) The forward price equals the expected future spot price.
• B) The forward price is greater than the expected future spot price.
• C) The forward price is less than the expected future spot price.
• D) The forward price is sometimes greater and sometimes less than the expected future spot price.

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Definitions:

Same Outcome

Refers to the scenario where different methods or processes yield identical results or conclusions.

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Practices or decisions that are grounded in systematically gathered evidence from research and data rather than anecdote or solely personal experience.

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