Buying and selling stocks in the stock exchange in anticipation of changes in the share...
COMMERCE
WAEC 2016
Buying and selling stocks in the stock exchange in anticipation of changes in the share price is?
- A. hedging
- B. projection
- C. forecasting
- D. speculation
Correct Answer: D. speculation
Explanation
Speculation refers to the act of conducting a financial transaction that has substantial risk of losing value but also holds the expectation of a significant gain or other major value. it is a situation where players in the stock exchange buy or sell securities with the expectation that they mabe a fall or rise in the prices of the said securities in future.
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