A speculator takes a position in the futures market without holding an offsetting position in the commodity market.

Question

Quizplus · Accepted Answer

A speculator takes a position in the futures market solely for the purpose of profiting from the price movements in the futures contract itself, without any intention of taking delivery of the underlying commodity. Therefore, they do not need to hold an offsetting position in the commodity market.

A Speculator Takes a Position in the Futures Market Without