Portia has a high-risk tolerance, so she decides to use futures contracts to buy lumber in spite of the fact that the United States may be placing tariffs on Canadian lumber. Portia is most likely
A) investing in mutual finds that focus on lumber.
B) buying exchange-traded funds.
C) engaging in commodities trading.
D) buying stock in Canadian companies.
E) diversifying her portfolio.

Question

Quizplus · Accepted Answer

Portia's use of futures contracts to buy lumber, especially in the context of potential tariffs affecting lumber prices, indicates that she is engaging in commodities trading. Futures contracts are a common financial instrument used in the commodities markets to agree on the purchase or sale of a commodity at a predetermined price at a specified time in the future.

Portia Has a High-Risk Tolerance, So She Decides to Use