Nurul Jannah is a Financial Risk Manager in a large offshore bank in Labuan. She intends to buy additional stocks valued at RM15 million, however, she expects to receive the fund 3 months from today.  What is the risk? Select one: a. Three months later the price of the stocks might move SIDE-WAY b. Sir, this question is difficult to understand c. Three months later the price of the stocks might INCREASE to RM20 million  d. Three months later the price of the stocks might DECREASE to RM10 million e. Three months later the price of the stocks might move SIDE-WAY to RM15 million   Question 2 Nurul Jannah is a Financial Risk Manager in a large offshore bank in Labuan. She intends to buy additional stocks valued at RM15 million, however, she expects to receive the fund 3 months from today.  What must she do to manage possible risk of losses? Select one: i. do nothing ii. Sir, what is the correct answer? iii. buy futures contract  iv. Sell futures contract

SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter14: Property Transact Ions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 43P
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Nurul Jannah is a Financial Risk Manager in a large offshore bank in Labuan. She intends to buy additional stocks valued at RM15 million, however, she expects to receive the fund 3 months from today. 

What is the risk?

Select one:

a. Three months later the price of the stocks might move SIDE-WAY
b. Sir, this question is difficult to understand
c. Three months later the price of the stocks might INCREASE to RM20 million 
d. Three months later the price of the stocks might DECREASE to RM10 million
e. Three months later the price of the stocks might move SIDE-WAY to RM15 million
 

Question 2

Nurul Jannah is a Financial Risk Manager in a large offshore bank in Labuan. She intends to buy additional stocks valued at RM15 million, however, she expects to receive the fund 3 months from today. 

What must she do to manage possible risk of losses?

Select one:

i. do nothing
ii. Sir, what is the correct answer?
iii. buy futures contract 
iv. Sell futures contract
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