Which of the Following Statements Is False Regarding Electronic Communications

question 52

Multiple Choice

Which of the following statements is false regarding Electronic Communications Networks (ECNs) ?

• A) Archipelago and Instinet are two examples of ECNs.
• B) Competition from ECNs has forced NASDAQ to cut its fees.
• C) Traders benefit from lower trading costs and faster service.
• D) ECNs allow institutional investors, but not individuals, to trade after hours.

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Definitions:

Short

Refers to short selling, a strategy used by investors who anticipate a stock's price will decline, allowing them to buy back at a lower price.

CME Weather Futures

Financial derivatives traded on the Chicago Mercantile Exchange that allow for hedging or speculation on weather-related risks.

Cash-Settled Contract

A financial agreement where the difference in the value of a contract is exchanged in cash rather than through physical delivery of goods or assets.

Agricultural Contract

A contract for the future sale or purchase of agricultural products, such as crops or livestock.