If a hedge derivative is deemed ineffective are classified as investment purpose.

Name: If a hedge derivative is deemed ineffective are classified as investment purpose.
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Question

Quizplus · Accepted Answer

If a hedge derivative is deemed ineffective, it means that it is not providing the intended hedge against a specific risk and therefore cannot be classified as a hedging instrument. Instead, it would be classified as an investment instrument used for speculative purposes. Therefore, option A is correct.

If a Hedge Derivative Is Deemed Ineffective Are Classified as Investment