Soa ifm - Study guides, Class notes & Summaries

Reasons to use derivatives - answer-1. To manage/reduce risk 2. To speculate - like placing a bet on what will happen in the future 3. To reduce transaction costs 4. To minimize taxes/avoid regulatory issues Market order - answer-a request to buy or sell a stock at the current market price - advantage: can immediately own or sell the stock disadvantage: the price could move more favorably in the future Limit order - answer-An order to a broker to buy a specific stock only if its price ...