The Trading Activity Involving Purchases of Large Blocks of Securities

question 20

Multiple Choice

The trading activity involving purchases of large blocks of securities on the expectation of a favorable price move over the next several weeks or months is called

• A)program trading.
• B)pure arbitrage.
• C)day trading.
• D)position trading.
• E)hedging.

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Definitions:

Game Theory

The study of how people behave in strategic situations in which individuals must take into account not only their own possible actions but also the possible reactions of others. Originally developed to analyze the best ways to play games like poker and chess.

Economies Of Scale

Cost advantages that enterprises obtain due to their scale of operation, typically associated with efficiencies in production as output increases.

Collusion

An agreement between firms in a market to limit competition and manipulate prices or market conditions.

Game Theory

A theoretical framework for conceiving social situations among competing players and predicting their choices of action through mathematical models.