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Exam Code: CDMS-SMM3.0

Exam Name: Certified Digital Marketing Specialist - Social Media Marketing

Version: V15.35

Q & A: 208 Questions and Answers

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NEW QUESTION: 1
In early March, an energy trader takes a long position in natural gas futures for delivery in June, and hedges
this exposure by taking a position in futures for July delivery. These trades were executed on the expectation
that over time, the relative prices of the June and July contracts will come into alignment, the movement in
these two contracts will largely mirror each other, and as a result of this, the net exposure is minimized and the
position is protected against absolute price movements. However, if the two relative prices do not come into
alignment with each other due to the scarcity of any of the two traded contracts in the futures market, the
trader is likely to become exposed to the
A. Calendar spreads basis
B. Quality basis
C. Product basis
D. Location basis
Answer: A

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