When investors take a short position in one asset to invest more in another asset,they are using:

Question

Quizplus · Accepted Answer

When investors take a short position in one asset to invest more in another asset, they are using financial leverage. This is because they are using borrowed money to invest in the other asset. Capital budgeting involves making investment decisions to allocate capital towards projects or investments, while corporate leverage refers to a company's use of debt financing. Neither of these options fully explain the scenario described in the question.

When Investors Take a Short Position in One Asset to Invest