The Basic Difference Between Speculators and Hedgers in Futures Contracts

question 8

Multiple Choice

The basic difference between speculators and hedgers in futures contracts is that speculators:

• A) will profit regardless of the direction of price change.
• B) are not protecting their commodity holdings.
• C) are concerned only with long-term price movements.
• D)take a position in more than one commodity at a time.

---

Definitions:

Psychoanalytic Theory

A theoretical framework developed by Freud that emphasizes unconscious mental processes and childhood experiences in shaping behavior and personality.

Childhood Experiences

Events and interactions during the early years of life that significantly influence one's personality, behavior, and psychological development.

Projection

Projection is a defense mechanism in psychology where an individual attributes their own unacceptable thoughts, feelings, or motives to another person.

Childhood Experiences

Early life events and influences that contribute to the shaping of an individual’s personality, behaviors, and perceptions throughout their development.