The process by which investors seek to proﬁt by simultaneously selling an asset with a lower rate of return and buying an otherwise identical asset with a higher rate of return is known as
A) hedging the market.
B) passive fund management.
C) arbitrage.
D) portfolio balancing.

Question

Quizplus · Accepted Answer

The process described in the question is known as arbitrage. Hedging the market refers to reducing risk through investments in different assets, passive fund management refers to investing in a diversified portfolio with a long-term strategy, and portfolio balancing refers to adjusting an investment portfolio to meet specific goals or risk preferences.

The Process by Which Investors Seek to Proﬁt by Simultaneously