To exploit an expected decrease in interest rates, an investor would most likely
A) buy Treasury bond futures.
B) take a long position in wheat futures.
C) buy S&P 500 Index futures.
D) take a short position in Treasury bond futures.
E) None of the options are correct.

Question

Quizplus · Accepted Answer

When investors expect interest rates to decrease, bond prices typically increase. Buying Treasury bond futures allows investors to profit from the anticipated rise in bond prices due to falling interest rates.

To Exploit an Expected Decrease in Interest Rates, an Investor